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Post-pandemic shifts in medical electronics GVCs and changing value dynamics amidst new digitalisation: An analysis based on Indian subsidiaries of EU-based corporations

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  • Smitha Francis

Abstract

Realignments of global value chains (GVCs) are occurring at a time when the technological dynamics in manufacturing industries, including in healthcare-related industries like medical electronics, is undergoing significant changes due to the wave of new digitalisation. This study examines post-pandemic changes in global medical electronics value chains through industry-level trade analysis and the GVC participation of selected Indian subsidiaries of medical electronics companies based in the European Union (EU), focusing on the implications of digitalisation and data-centric strategies for capturing value. The study finds that post-COVID-19 realignments in the industry proceeded gradually until 2023. Meanwhile, digitalisation is leading to a gradual expansion in operations by EU-based medical device multinational corporations (MNCs) in India. This is shown to be due to the increased role of software for product design and process optimisation in digitalising value chains. Leading EU-based medical device MNCs are found to be leveraging India’s strengths in software design and data-analytics capabilities for co-developing their software-embedded ‘health systems’ and ‘solutions’. However, even when software and services exports from India went up with increasing digitalisation, the shares of the EU-based lead firm groups in total revenue of the Indian subsidiaries were found to increase. This occurred through imports of software-embedded medical devices and equipment along with imports of higher-valued proprietary software platforms, health systems and the like, which are patented and marketed by the EU-based lead firms or their foreign subsidiaries back to India.

Suggested Citation

  • Smitha Francis, 2025. "Post-pandemic shifts in medical electronics GVCs and changing value dynamics amidst new digitalisation: An analysis based on Indian subsidiaries of EU-based corporations," wiiw Research Reports 479, The Vienna Institute for International Economic Studies, wiiw.
    • Handle: RePEc:wii:rpaper:rr:479
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    References listed on IDEAS

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    1. Smitha Francis, 2020. "Digital Transformations and Structural Exclusion Risks: Towards Policy Coherence for Enabling Inclusive Trajectories," India Studies in Business and Economics, in: Keshab Das & Bhabani Shankar Prasad Mishra & Madhabananda Das (ed.), The Digitalization Conundrum in India, chapter 0, pages 13-44, Springer.
    2. Sturgeon,Timothy J. & Zylberberg,Ezequiel, 2016. "The global information and communications technology industry : where Vietnam fits in global value chains," Policy Research Working Paper Series 7916, The World Bank.
    3. Freeman, Chris & Louca, Francisco, 2002. "As Time Goes By: From the Industrial Revolutions to the Information Revolution," OUP Catalogue, Oxford University Press, number 9780199251056.
    4. Carlota Perez, 2009. "Technological revolutions and techno-economic paradigms," The Other Canon Foundation and Tallinn University of Technology Working Papers in Technology Governance and Economic Dynamics 20, TUT Ragnar Nurkse Department of Innovation and Governance.
    5. Pérez, Carlota, 2001. "Technological change and opportunities for development as a moving target," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), December.
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    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • L64 - Industrial Organization - - Industry Studies: Manufacturing - - - Other Machinery; Business Equipment; Armaments
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology

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