THE Confederation of Indian Industry (CII) and the Confederation of British Industry (CBI) held their annual conference last week in London when the two sides discussed “the future of UK-India economic relations”.
The CII delegation, made up of senior captains of industry, also met a number of British ministers, among them Hugo Swire, foreign office minister; Oliver Letwin, chancellor of the Duchy of Lancaster who is known to be close to David Cameron; and Lord Maude, trade and investment minister.
The delegation was also impressed with a team from Manchester that included representatives of Manchester University, several local companies and trade organisations and Manchester United – Indian footballers are apparently keen to learn how to score goals.
There was also a meeting at Marlborough House when India’s role in the Commonwealth was discussed with the Commonwealth Enterprise and Investment Council (CWEIC) under its chairman Lord Marland.
A strategic partnership agreement was signed “to further Indian industry’s leadership in the Commonwealth”. Both the CII and the CBI agreed that after 14 months in office, Narendra Modi’s government has aroused expectations it will deliver on the economic front.
There were predictions that the GDP will grow from 7.4 per cent in the 2014-2015 fiscal year to nine or even 10 per cent in a couple of years.
CII president Sumit Mazumder declared: “There hasn’t been another government in the history of India that has achieved as much as this government.”
Both the British and Indian sides also agreed that with India preparing to invest $1 trillion (about £800 billion) in such infrastructural projects as roads, ports, civil aviation, railways, 100 smart cities, green technology, renewable energy, and water and waste management, there are opportunities galore for British industry.
Judging by what the CII said, it does seem that after three or four years when not very much happened in India, economic activity is picking up again.
If that is the case, the people who stand to benefit most are British Indians, who now number between 2.3 million and 2.5 million (although the word has gone out from the British government that an underestimate of 1.5m should be used in official discussions).
Again and again, the point was made that Britain has two things that India needs – technical expertise and the ability to raise large sums of money for capital expenditure, especially through the City of London.
As in the past, it is British Indians who will act as go between, a role which Cameron was quick to recognise early in his premiership. Having a number of Indian origin ministers in his government appears to have helped.
There were positive references by the CII to both Baroness Verma and Priti Patel, although it is unclear whether the latter remains Cameron’s “diaspora champion”.
In what is an otherwise a sunny picture, the only dark clouds are being cast by the Home Office, which seems determined to spoil the party.
The CBI has decided it is time to celebrate. Thus, John Cridland, the CBI’s director general, announced: “The inaugural CBI Indian banquet will take place in London on September 17.”
The black tie affair “to celebrate our thriving business relationship” will be held in the grand setting of the Mansion House. It will be held in
partnership with the CII and Indian IT giant Infosys (which means Rishi Sunak, Tory MP and son-in-law of the company’s founder, NR Narayana Murthy, shouldn’t have problems getting an invite).
The big question is what will be on the menu: biryani or beef and boiled veg? Actually, what will be on the menu is the chance to make big money. Britain did it once in the time of Robert Clive without asking the Indians.
Now, it is a relationship of equals. In his conference speech, the CBI’s director general slightly flattered the Indians: “As the World Bank says, you now have the fastest growing economy in the world, overtaking China for the first time.”
Your middle class is set to double in the next decade from 200 million to nearly 400 million. What an opportunity for British business!” Incidentally, Cridland read history as an undergraduate at Christ’s College, Cambridge, when he took a special paper in “19th century Rajasthan”.
He emphasised: “Infrastructure investment is a real opportunity.” “Two years ago Vodafone invested $3bn in expanding its network into Indian rural areas, citing population as one of the biggest reasons for its long term commitment,” he reminded his audience, who were also told there are a billion mobile phones in India today.
“Marks & Spencer is already one of India’s largest foreign clothing chains, with plans for 100 stores in India by 2016. And Diageo has increasingly important stakes in your sprits industry.
And companies like JCB and Standard Chartered and HSBC are already household names in your country.” “Prime minister Modi’s ‘Make in India’ project alongside digital India, skills India and the 100 smart cities initiative have opened a new world of opportunity for British businesses,” he enthused.
“The push for smart cities and clean technology in particular plays so well to the strengths that UK business can bring to help India achieve sustainable growth.”
But defence, aerospace and advanced engineering were areas where Britain could do better. Cridland also had a warning: “On tax, allow me to say that tax remains a hurdle, stopping more British businesses engaging in India. The recent tax notice to Cairn Energy of $1.6bn, imposed retrospectively, is frankly of concern.”
Cridland was echoing the points made by the delegation’s leaders. The CII’s director general, Chandrajit Banerjee, spoke of how Britain could lends its skills to India: “It important for foreign companies coming into India to find the right type of people. We are looking at numbers which are crazy – we have to train 500m people by 2020.
A former CCI president, Sunil Kant Munjal, chairman, Hero Corporate Service, summed up: “Manufacturing is likely to be the best growth engine Indian can provide – every manufacturing job has the potential to create three to five manufacturing-related services.
“We need to create a million new jobs a month for the next 10 to 15 years for us to be able to absorb all the young people.”