India and EU Seal Landmark Free Trade Agreement, Slashing Billions in Tariffs

For decades, the story of Indian pharma was written in the language of "volume." It was the "pharmacy of the world" - a massive, low-cost engine churning out millions of generic tablets as a quiet subcontractor for Western brands. But a quieter, more sophisticated revolution has reached its tipping point in 2026. The sector is shedding its image as a mere factory for hire and emerging as a high-stakes architectural firm for drug development.Leading this charge is Akums Drugs & Pharmaceuticals, a company that mirrors the broader Indian arc: a journey from a cost-competitive domestic manufacturer to a global, innovation-led partner.The Evolution: From Filling Orders to Designing SolutionsThe transition of Akums follows a classic industrial "climb" that parallels how global manufacturing leaders shift from generic production to value-added services. By moving from OEM (Original Equipment Manufacturer) to a strategic partner, Akums has fundamentally changed its value proposition through three distinct eras:The Scale-Up (2004–2010): Focus on high-volume oral solids (tablets and capsules) for the Indian domestic market, competing on price and manufacturing efficiency.The Quality Pivot (2011–2020): Aggressive investment in GMP-aligned facilities. The company secured approvals from the WHO, EU-GMP, and ANVISA (Brazil), satisfying Western regulatory rigors to expand beyond local borders.The "D" in CDMO (2021–Present): Shift from taking orders to offering formulation development, stability testing, and clinical trial supplies. With four DSIR-approved R&D centers and a library of over 4,200 commercialized formulations, they now function as a technical extension of global pharma brands.The New Architecture: India’s CDMO Landscape in 2026The shift from "volume" to "value" is best understood by comparing the champions of this space. While traditional titans like Divi’s dominate in chemical synthesis, the new wave of CDMOs focuses on complex research and integrated manufacturing.Akums Drugs & Pharmaceuticals: Market Cap of ~$798 million (as of Jan 27, 2026). Specialized in complex formulations with 140+ patents. Their current focus is on specialized modalities like extended-release "tablet-in-tablet" technology.Divi’s Laboratories: Market Cap of ~$19.1 billion. The undisputed leader in API (Active Pharmaceutical Ingredient) and custom synthesis, maintaining high margins through massive economies of scale.Syngene International: Market Cap of ~$3.0 billion. An integrated CRDMO (Contract Research, Development, and Manufacturing Organization), heavily invested in biologics with a significant presence in the US to service global biotech firms.Financial and Market Profile: A 2026 SnapshotAs of January 2026, Akums stands as a symbol of the sector’s maturity. Following its 2024 IPO, the company has navigated a complex global "reset" in pharma spending. (Figures converted at $1 = ₹83.5).Revenue Resilience: For H1 FY26 (ending Sept 2025), Akums reported revenue of $244.5 million. Despite a slight 1.5% YoY revenue dip in Q2 due to falling API prices, core CDMO volumes grew by 7%, outpacing the broader industry.Profitability Trends: The company reported a Net Profit of $5.1 million in Q2 FY26. While the EBITDA margin dipped to 9.3% (from 12.6% in Q1), management expects a recovery to the 12-14% range in the second half of the year as newer facilities ramp up.Global Footprint & Guaranteed Offtake: In late 2025, Akums began construction on a $45 million pharmaceutical plant in Zambia (Akums holds a 51% stake). Crucially, the Zambian government has committed to purchasing $50 million worth of medicines from Akums’ Indian facilities across 2026 and 2027 while the plant is under construction.The "EU-GMP" Crucible and AI-Led ComplianceThe European market is the primary battleground for high-margin contracts. In January 2026, Akums received EU-GMP renewal for its Plant 1 and first-time certification for its Plant 2 in Haridwar.This regulatory green light from the Bulgarian Drug Agency is the key to unlocking a landmark €200 million (~$217 million) European supply contract signed in December 2024. To service this and future Western contracts through 2027, Akums is deploying "Pharma 4.0" digital quality tools:Predictive Quality Assurance: Integrating AI with Manufacturing Execution Systems (MES) to detect anomalies in process parameters (temperature, pressure) before batch failures occur.Computer Vision for Visual Inspection: Automated AI systems that identify packaging and product defects with higher precision than human operators, meeting stringent EU standards.Digital Audit Readiness: Paperless workflows and AI-powered document management to ensure "Data Integrity" remains beyond reproach during unannounced regulatory audits.2027 Risk Assessment: The Geopolitical CrucibleWhile European expansion (EU-GMP) and African infrastructure provide a buffer, the United States remains a high-stakes geography.The "Tariff Bombshell": Proposed US tariffs under Section 232 pose a risk. However, standard generics - which account for 90% of US prescriptions -remain largely insulated to avoid domestic drug shortages and public health crises.The Biosecure Act Opportunity: The US Biosecure Act (passed into the NDAA for 2026) mandates a decoupling from Chinese biotechnology "companies of concern." This is expected to trigger a multi-billion dollar shift in contracts, with Indian CDMOs positioned as the primary "China-plus-one" beneficiaries.From Workhorse to ArchitectThe Indian CDMO sector is projected to reach $29.53 billion by the end of 2026, growing at a CAGR of 14.4%. This growth is no longer driven by "more of the same," but by high-value partnerships in biologics, peptides, and sterile injectables.Akums' journey - from a local manufacturer to a partner supplying life-saving medications to Switzerland, Germany, and Zambia - reflects the transition of Indian pharma from capacity to capability. As Western pharma faces rising R&D costs and trade friction, the Indian CDMO has become their most vital collaborator: the firm that knows how to make medicine both innovative and accessible."The renewal of EU GMP certification for Plant 1 and the new certification for Plant 2 strengthen our ability to serve regulated markets with confidence and support our long-term partnerships and sustained global growth." — Sandeep Jain, MD, Akums Drugs & Pharmaceuticals (January 23, 2026). The Economic Times.----Join SEINET - the digital platform building the European, UK and Indian corporate and startup leaders ecosystem to accelerate growth and partnerships between the markets. Become part of a trusted ecosystem of business and innovation leaders from Airbus, Microsoft, Eli Lilly and others. Request to join www.startupeuropeindia.net

How the EU’s Carbon Border Adjustment Mechanism has moved from theory to enforcement - and why it now sits at the centre of EU–India economic negotiations.CBAM: from climate policy to trade realityThe Carbon Border Adjustment Mechanism (CBAM) is no longer a future policy experiment. As of January 2026, it has entered its implementation phase and is now a concrete cost, compliance and strategic issue for exporters into the European Union. For India, this marks a turning point: CBAM is no longer just a climate discussion, but a live trade issue shaping negotiations, supply chains and pricing decisions.At its core, CBAM applies a carbon price to certain imported goods to reflect the cost EU producers already face under the EU Emissions Trading System (ETS). The objective is simple and explicit: prevent carbon leakage and ensure that climate ambition inside the EU is not undercut by cheaper, higher-emission imports from abroad.What exactly is CBAM?CBAM requires EU importers to account for the greenhouse gas emissions embedded in specific categories of goods. When fully phased in, importers must surrender CBAM certificates corresponding to those emissions. The certificate price mirrors the EU ETS carbon price. If a carbon price has already been paid in the country of origin, that amount can be deducted, subject to verification.CBAM currently covers highly carbon-intensive sectors: iron and steel, cement, aluminium, fertilisers, electricity and hydrogen. These sectors matter disproportionately in global trade - and several are core export categories for India.The critical shift in 2026Between 2023 and 2025, CBAM operated in a transition phase. Importers were required to report emissions, but no financial adjustment applied. That period is now over.From January 2026, CBAM moved into its definitive phase. Reporting is no longer a dry-run exercise; it is part of an enforcement framework integrated with EU customs systems. While some elements, such as the full phase-out of free ETS allowances, will be gradual through the early 2030s, CBAM is now operational in principle. For exporters, the message is clear: emissions data quality, verification and cost exposure now directly affect access to the EU market.Why CBAM matters specifically for IndiaIndia is not being singled out, but it is unavoidably exposed. The EU is one of India’s largest trading partners, and several CBAM-covered sectors feature prominently in bilateral trade.The immediate implications are threefold.First, cost and competitiveness. Indian exporters whose products have high embedded emissions face a potential price disadvantage unless they can demonstrate lower carbon intensity or deduct an equivalent domestic carbon price. In sectors like steel and fertilisers, even a modest carbon price can materially affect margins.Second, data and compliance. CBAM is as much a reporting regime as a pricing mechanism. Exporters must produce credible, auditable emissions data aligned with EU methodologies. This requires new monitoring, reporting and verification (MRV) capabilities - often across complex, multi-tier supply chains.Third, strategic positioning. CBAM shifts the basis of competition. Price alone is no longer enough; carbon efficiency becomes a trade asset. Firms that invest early in cleaner processes are better positioned not only for EU market access, but for future trade regimes that may follow similar logic.CBAM and EU–India trade negotiationsCBAM has inevitably entered the centre of EU–India trade discussions, including the long-running negotiations toward a free trade agreement (FTA).From the EU’s perspective, CBAM is non-negotiable in principle. It is embedded in EU climate law and tied to the integrity of the ETS. From India’s perspective, CBAM raises concerns about fairness, development space and administrative burden, particularly for emerging-market producers.The negotiation space lies in the details. India is pushing for clarity on how domestic climate policies - present and future - can be recognised under CBAM. Technical cooperation on emissions accounting, transitional support for exporters and predictable implementation timelines are now key discussion points. CBAM, in this sense, has become a lever: not a tariff to be bargained away, but a framework within which trade concessions, cooperation and equivalence may be negotiated.The broader signal CBAM sendsBeyond EU–India relations, CBAM signals a deeper shift in global trade governance. Environmental performance is being hard-wired into market access. This does not replace traditional trade rules, but it increasingly overlays them.For India, this creates a strategic choice. One path is defensive: minimise short-term disruption and seek carve-outs. The other is forward-looking: treat CBAM as an external pressure that accelerates domestic decarbonisation, strengthens export competitiveness and aligns Indian industry with the direction of global regulation.What exporters should do nowFor companies exporting to the EU, CBAM is no longer abstract. Practical steps are needed:Map exposure to CBAM-covered products and inputsBuild reliable emissions data systems aligned with EU rulesAssess cost impacts under different carbon price scenariosEngage early with EU importers, who carry the formal CBAM obligationsInvest in efficiency and low-carbon processes where feasibleWaiting for policy clarity is no longer a viable strategy. The compliance clock has started.The bottom lineCBAM marks a structural change in how the EU trades with the world. For India, it is both a challenge and an opportunity. The challenge is immediate: higher compliance costs and tougher market access conditions. The opportunity lies in using this moment to modernise industrial processes, strengthen negotiating leverage and position Indian exporters for a carbon-constrained global economy.CBAM is not a passing regulation. It is a preview of how climate policy and trade policy are converging - and EU–India economic relations will increasingly be shaped at that intersection.-------SEINET is the go-to-market (GTM) and strategic partnership platform that connects corporate and startup leaders, enabling cross-border collaboration, market expansion, and long-term growth between Europe and India. Request to Join for Free www.startupeuropeindia.net

UAE President Sheikh Muhammad bin Zayed al-Nahyan recently conducted a three-hour engagement in New Delhi with Prime Minister Narendra Modi, marking his fifth visit to India in ten years and his third as President.The warmth of the relationship was highlighted by PM Modi personally receiving the President at the airport, followed by a customary car ride to the talks.The Concept of Strategic AutonomyMutual Policy Goal: Both nations highlighted strategic autonomy-the ability to make independent foreign and security policies based on national interests-as a core principle.Exclusive Recognition: India includes the phrase "strategic autonomy" in joint statements with only a few countries, such as France.UAE's "Northstar": For the UAE, strategic autonomy is viewed as a "northstar" in a fragmented world to avoid zero-sum competition and reduce international polarisation.Economic and Infrastructure AgreementsEnergy Security: The two countries signed a long-term agreement for India to purchase 0.5 million metric tons of liquefied natural gas (LNG) per annum from the UAE for 10 years, starting in 2028.Dholera Investment Region: A joint development project in Gujarat’s Dholera state will focus on key strategic infrastructure, including an international airport, a smart urban township, a greenfield port, and railway connectivity.Civil Nuclear Cooperation: The nations will cooperate on developing and deploying large nuclear reactors and small modular reactors under new Indian laws.Digital Embassies: A relatively new concept was introduced involving "digital embassies," which allow a country to extend its sovereign digital infrastructure and store vital data in a foreign country while maintaining control and ownership of that data.Strategic Defence Partnership (SDP)New Institutional Framework: The signing of a Letter of Intent for a Strategic Defence Partnership signals a shift toward a more institutionalised framework for security cooperation.Industrial Collaboration: The partnership aims to move beyond simple exercises toward defense industrial collaboration, including the co-production of weapons and technologies.Expanded Cooperation Areas: Future focus areas include special forces training, advanced technology innovation, counter-terrorism, and addressing threats in cyberspace.Evolution of Ties: This partnership builds on a year of "watershed" momentum, including visits from UAE service chiefs and the Dubai Crown Prince, as well as regular participation in the Dubai Air Show.Geopolitical and Regional ContextDiversification of Ties: Analysts suggest the UAE is using its relationship with India to diversify its strategic options.Regional Rivalries: The deepening of ties occurs against a backdrop of competition between the UAE and Saudi Arabia for influence in Yemen and Sudan, as well as the formation of an "Islamic NATO" involving Saudi Arabia, Pakistan, and Turkey.Maritime Security: The UAE now views India as a primary partner for maritime security and innovation in the Indian Ocean region, moving beyond traditional Western allies.Indian Footprint in the Gulf: The partnership strengthens India’s influence in the Gulf without requiring formal alliance obligations or direct involvement in regional conflicts.Building on Previous Milestones: This cooperation builds on the 2022 Comprehensive Economic Partnership Agreement (CEPA) and the 2023 India-Middle East-Europe Economic Corridor (IMEC).Reading and listening material:https://www.khaleejtimes.com/business/two-rising-powers-one-strategic-vision-uae-and-indiahttps://www.khaleejtimes.com/business/two-rising-powers-one-strategic-vision-uae-and-india?_refresh=truehttps://www.youtube.com/watch?v=du-GzIBDneM-------SEINET is an go-to-market and strategic partnership ecosystem platform that connects corporate and startup leaders, enabling cross-border collaboration, market expansion, and long-term growth between Europe and India. Request to Join for Free www.startupeuropeindia.net