I have just spoken to Baroness Verma who was at the Oath of Office taking of the new Indian PM, and asked in person by the UK PM to convey his congratulations. When I was with Minister Verma on an official trip last year we met the man who is now the number two in the Indian Government, Rajnath Singh.
A new Indian PM, a State Opening of Parliament; so I want to turn to therefore turn to UK-India trade. The mathematics is simple: British firms need investment returns offered by India that they simply can’t get at or near home. Britain has a burgeoning trade deficit. It needs to create jobs. Its companies have the talent and experience to export – it did after all create the world’s first multinational – the East India Company. An Island of a mere 1% of the world’s population generates 4% of world GDP. So British companies need help penetrating the Indian markets. Help more importantly from British Indians who know more, can access more, in India.
So what’s the problem? The problem is the disparity between talk, understanding the issues, and ideas and execution. In January 2006, US Secretary of State Condoleeza Rice observed that the US State Department had “nearly the same number of State Department personnel in Germany, a country of 82 million people, that we have in India, a country of one billion people. The UK must avoid the same error.
The UK Government needs to re-allocate more resources in India to its Foreign Policy, Defence and Trade and Investment policies. If countries can be thought of a companies, then Britain should follow the lead of virtually every S&P 500 and FTSE 100 company which has done exactly that – put more people on the ground in India.
But it needs to use not just the same old usual diplomatic channels which every other Government shall use, but also the personal connections and ties that British Indians have with India, from the top, such as Minister Verma to the Indian Government to the regular British Indian business member of the UK India Business Council. That is how you start a special relationship, you use the special resources you have at hand. No other country can match Britain then for a special relationship with India – just ask the UK Overseas Friends of the BJP.
According to a UKIBC NRI survey 97.6% thought India’s business potential was good or excellent, 85.7% felt the recession made investment in India more attractive. But shockingly 61% said it was not easy or difficult to enter the Indian market. The answer for a cash-strapped UK is not to simply leave it to the private sector.
However, Britain’s economic problems also need more capital investment from abroad. Again the maths is simple. Without investment capital, research, development needed for future growth and competitiveness dies. Without such inward investment jobs are lost. Britain’s geo-economic location within the EU and links with the US makes it an ideal ‘go global’ base for Indian companies.
The UK Government with me will be co-hosting the largest collection of Indian investors and Venture Capitalists in India at the end of August – this will be one more vital step to building a special relationship between the UK and India – which simply cannot be left to the ‘usual channels’ and the same old ways – it’s essential for British Indians to step up.