UK is keen to be a partner in India's success story and this is an opportunity for India to deal with the UK on more even terms than ever before in history.

Ratan Tata, Sunil Bharti Mittal, N. Chandrasekaran, and Baba Kalyani. If this sounds like a list of the top corporate leaders in India, then it is, but, with a difference. Under the aegis of the India-UK CEOs Forum, these corporate leaders, under chairman Ratan Tata, are leading Indian deliberations with their counterparts in the UK industry and government to spur better trade and investments between the two countries. These relations have reviewed a further fillip, as the forums have been reconstituted and constructive talks and announcements have materialized after the recent state visit by Indian Prime Minister Narendra Modi to the UK. With Modi and his counterpart David Cameron setting the pace, there has been a spate of announcements from both sides on tapping the synergies between these two  nations.

Investor Confidence
The UK, over the last few centuries, has been one of the largest global economies, with a growing diaspora from India actively contributing to their recent growth. At the same time, India is now seen as a safe haven oasis in the desolate desert that the global economy looks like, and is the prime investment destination for foreign funds keen to be part of a fast-growing economy. This is evidenced by the fact that UK has been the single largest investor from the G20 Group of Nations into India over the last 14 years. UK accounts for 8.56% of the total foreign direct investment into India since 2000, while Indian companies provide employment to 110,000 people in the UK.

Around £ 9.2 billion of commercial deals were announced between India and the UK around the state visit, and this is just the tip of the proverbial iceberg. While the leaders of both countries have set the pace at the top, it is imperative that this momentum is carried forward by the corporate leaders to spur further growth prospects. While Housing Finance Development Corporation is looking to raise money via the City of London route, marquee British company Rolls-Royce has recently awarded a contract to India's Bharat Forge to supply parts for a range of aero engines.

Walking the Talk
India needs foreign money to fund its growth ambitions, and investors from the UK, including corporates, are hoping that the government will walk the talk and pave the way for more investment into India. India needs various intellectual property rights, as well as science and technology leeway from a country like the UK, to make the ambitious 'Make in India' a success. Even from a strategic perspective, India needs to enable ease of investment into the country, as its neighbour fellow developing nation China has been aggressive in reaching out to the UK through the economic and investment route.

UK has a historical lead and advantage in creating sustainable cities and allied infrastructure that has stood the test of time, and India would be looking to tap this area of expertise to improve its infrastructure and contain supply bottlenecks. In 2014, the UK had announced a 1 billion pound credit line to help British businesses invest into Indian infrastructure projects. UK has expressed its interest in renewable energy (solar and hydro), smart cities, and railway investments in India, which are exactly in sync with Indian economy requirements.

At the same time, UK investors continue to look to the government in India to further ease norms for investments into India, stability in regulations and laws, clarity on taxation - including retrospective taxes, and also a sustainable trend in markets, which would enable them to get attractive risk-adjusted returns from the sub-sectors in which they are investing.

Making the Dream Work
The UK-India CEO Forum, which has 20 of UK's top business leaders and is co-chaired by Standard Life Chairman Gerry Grimstone and Tata Sons' Chairman Cyrus Mistry, has also identified 6 key areas of collaboration possible between the two countries - health and hygiene, smart cities and digital economy, education and skills, manufacturing and defence and security, financial and professional services and ease of doing business bilaterally. India needs to also push for investments and know-how sharing in areas such as infrastructure, logistics, and transport from its UK counterparts.

The newfound camaraderie between the leaders of the UK and India, the creation of dedicated CEO forums in both nations, the promise of further discussions at the finance minister level and understanding of needs of both countries have set a strong foundation for greater bilateral engagement.

India is the best investment destination around the globe today, but needs to realize that it's ambitions need support from existing developed players such as the UK. UK is keen to be a partner in India's success story and this is an opportunity for India to deal with the UK on more even terms than ever before in history.

 



As shared with IFIN Panorama Editorial Team

 

 

Ms Nandita Sahgal Tully

IL&FS Global Financial Services, UK Ltd. - London

 







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