This article is about UK-based GlaxoSmithKline (GSK) increasing its stake in its Indian subsidiary (GSK Pharmaceutical Ltd) from 50.7% to 75%, despite the regulatory environment instability related to drug price controls and tension over patent issues (Ward 2014). Implementing new price controls is also likely to result in a lower profit margin. However, the increase in GSK India shares indicates GSK's confidence in the Indian market, the need for greater control and its intention to focus on the emerging market. GSK believes that progressive increases in spending will outweigh pricing restrictions (Ward 2014). Application of Concepts India has a mixed market economy structure where government intervention is active but the economy runs predominantly on market forces (Morrison 2011). The government had recently used interest rates – monetary instrument as a tool to tackle high inflation and stimulate economic growth (Times of India 2014). However, since companies are sensitive to directional change in interest rates, an increase in interest rates would lead to an increase in financial burden for GSK India (Park 2013). The pharmaceutical industry mainly falls under the creative change in industrial change trajectories as the core assets of the businesses such as assets, knowledge and brand capital are constantly under challenge (McGahan 2004). However, a prolonged problem that exists in India is disputes relating to intellectual property (IP) rights. In 2005, patent reform in India changed intellectual property rules from 7 years of process patent, to bring them in line with Trade Aspects of Intellectual Property Rights (TRIPS) compliant intellectual property rights of 20 years of product patent . ......has no surprises, holds interest rates", Times of India, 1 April, viewed 2 April 2014, Tripathi, S. 2007, "India's Growth Path Steady but not Straight", Issues in Science and Technology, vol 23, no. 3, pp. 63-72, accessed 1 April 2014, ProQuest Central, 195926331. Tyagi, A. and Gupta, N. 2012, 'Corporate Social Responsibility [CSR] – Issues and Challenges in India', International Journal of Management Research and Reviews, vol. 2, no. 1656-1667, accessed 2 April 2014, 1432297216. Ward, A. 2014, 'GlaxoSmithKline raises stake in Indian subsidiary to 75%', Financial Times, 10 March, accessed 20 March 2014,