Finding opportunity beyond business hurdles

Finding opportunity beyond business hurdles

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Now is the time to work with India, according to the minister for commerce, industry and textiles, Anand Sharma. His comment was made during a visit to the UK with the aim of driving investment and bringing about closer mutual cooperation.

“There has been considerable turbulence in the global economy, but we now have to create a roadmap for the future,” Sharma said, speaking at an event organised by the UK India Business Council and the Federation of Indian Chambers of Commerce and Industry in London. “People have tended to be protectionist in the face of challenges, but that is counter-productive. Our countries should be partners.”

The minister highlighted the UK's commitment towards working with India on its ambitious Bangalore-Mumbai corridor and other key linkages in the field of manufacturing technology.

“We have started an age of knowledge-led economic growth and have identified innovation as a major driver of that,” he added. “Through a joint working group on advanced manufacturing, India and the UK will undertake joint studies towards being technology and equity partners in India's growth.”

His views were echoed by UK trade minister Lord Green, who also announced the official launch of a series of UK India Business Council centres in India.

“This launch marks a major milestone in the creation of a pan-India network of business centres that was announced by Prime Minister David Cameron during his visit to India in February,” Lord Green said. “The Business Centre in Gurgaon will be the first of six in India.”

The UK India Business Council has also signed a memorandum of understanding with Invest India to help find partners for joint ventures, to promote marketing cooperation and further technology transfers.

“I am delighted with the memorandum of understanding, which will help UK companies identify investment opportunities and business partners in India,” said the UK India Business Council chair, Patricia Hewitt. “Our partnership with the Federation of Indian Chambers of Commerce and Industry and Invest India will be a vital part of our new services to British businesses looking to enter or expand in India.”

Embracing Shariat banking

India could be about to embrace Shariat banking. A meeting between the minority affairs minister K. Rahman Khan and Bank of England officials suggests that the country, with a sizable Muslim population, could be about to make a formal announcement later this year.

The UK's self-declared aim is to become a hub for Islamic banking. Coupled with India's own desire to open up its own banking sector to Shariat-compliant businesses, the two partners in the negotiations may yet be able to work out a productive way forward.

“There is a huge demand for Shariat banking in India and the Reserve Bank of India is not averse to the idea,” said Khan, during a visit to London. “Given that the UK and India have more or less the same system, I hope to explore how Islamic banking can be introduced here.”

Khan was in Britain for talks with ministerial counterparts and welcomed Britain's enthusiasm over investing in a proposed Bangalore-Mumbai economic corridor during talks with Hugo Swire, Britain's minister of state in the Foreign Office in charge of India.

“Nearly 60% of the corridor will be in Karnataka and, being from there myself, I plan to seek all support from the state and central governments on this,” he continued. “The UK is very keen to invest in the project and I propose to take these discussions forward.”

He also sought information on the Tackling Extremism and Radicalisation Task Force, chaired by British Prime Minister David Cameron. “The task force, set up after the recent incidents in London, is a very welcome step to contain terrorism,” he said, following discussions with UK Secretary of State for Communities and Local Government, Eric Pickles. “We have promised to look at the details and consider a similar task force in India.”

The two ministers held talks about the UK's Equality and Human Rights Commission as a model for India's own Equal Opportunities Commission. Khan followed the discussions on the new commission with EHRC chair, Baroness Onora O'Neill, finishing a trip to London that appears to have charted many productive ways ahead for Indian banking and wider society.

Visa scheme threatens tourist and business meltdown

The much-hyped 'special relationship' said to exist between India and the UK clashes directly with a proposed scheme to charge visitors from the country £3,000 in refundable visa bonds. This is one of the British government's most controversial policies and Indian companies are struggling to make sense of the mixed messages it sends out.

Indian industry representative bodies such as the Confederation of Indian Industry and Federation of Indian Chambers of Commerce and Industry have both voiced their concerns over the proposal.

“We are disappointed by the decision of the UK government to go ahead with its pilot scheme,” said a statement from the Confederation of Indian Industry. “This is not in accordance with the 'special relationship' that India shares with the UK. It will stop Indian tourists from visiting the UK and we urge the UK government to consider removing India from the scheme.”

The Federation of Indian Chambers of Commerce and Industry is the voice of over 250,000 Indian public and private sector members, and highlighted the impact such a move will have on investment. “The British government is yet to define the 'high-risk' visitors category, which would be asked to furnish such bonds. India is the fourth-largest investor in the UK, so grouping us with countries like Ghana, Pakistan and Bangladesh is a matter of concern.”

It is understood that the policy has been the cause of major debate among British ministerial circles and exposed divisions in the ruling Conservative-led coalition government.

Business Secretary Vince Cable, a member of coalition partners the Liberal Democrats, has already warned against the anti-business sentiments the scheme would create. He stressed that the move would suggest that Britain is 'closed for business.' Cable had personally assured his Indian counterpart, Anand Sharma, that such a scheme would not be given government sanction. Seasoned India watchers will await future developments with interest.

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