It punctures intellect in this sceptred isle (7)
I believe the answer is:
britain
'this sceptred isle' is the definition.
('this sceptred isle' - Shakespeare, Richard II)
'it punctures intellect' is the wordplay.
'punctures' indicates putting letters inside (inserted letters puncture into the word).
'intellect' becomes 'brain' (brain is a kind of intellect).
'it' placed inside 'brain' is 'BRITAIN'.
'in' is the link.
(Other definitions for britain that I've seen before include "Main part of UK" , "Island north of France" , "UK's largest island" , "Largest UK island" , "Monarchy" .)