Bilateral pact with UK to focus on digital, F&B and healthcare: UKIBC CEO

In a Q&A, Jayant Krishna says market access and ease of doing business remain the main priorities for British businesses in India

While the Indian and UK governments gear up to flesh out the proposed trade deal between the two nations, market access and ease of doing business remain the main priorities for British businesses in India, UKIBC's new group CEO Jayant Krishna says. Krishna is the first Indian to take charge as CEO of the influential council, and tells Subhayan Chakraborty that while British companies may not outright abandon China in favour of shifting supply chains to India, many UK firms are exploring India as a large incremental base for manufacturing and R&D.

Which sectors are in focus for the proposed bilateral trade pact currently being negotiated by both nations?

UKIBC has welcomed both the governments’ shared ambition for a future FTA. The commitment to an enhanced trade partnership that came out of the UK-India Joint Economic Trade Committee (JETCO) at the end of July 2020 is seen as a roadmap to such an agreement. The three priority sectors agreed by both governments at JETCO in 2019 – food and drink, life science and healthcare, and digital and data services – are an important starting point for such action and the upbeat and constructive feedback from these sectors a year later is positive. This enhanced trade partnership is rightly focusing on market access issues and the ease of doing business, which businesses feel are their main concern.

Will the recent skirmishes between India and China lead to movement in British investment flows?

UK and India are also on a look out for opportunities emanating from the business sentiments worldwide to explore manufacturing supply chain possibilities as alternatives to China. But China has specific capabilities and a large, attractive market similar to India. It will remain an attractive destination for investment. Nonetheless, UK entities look at India as an incremental base for manufacturing and Research and Development. The collaboration between Oxford University, the UK’s Astra Zeneca and the Serum Institute of India is evidence of the kind of untold potential when British and Indian institutions work together. British firms remain committed to India and will expand their strong presence.

Which areas of the economy will see British interest post the pandemic?

British foreign direct investment in India has totaled over $28 billion since 2000 and continues to grow. Investments by UK firms have created 800,000 jobs in the organised sector. There are great complementarities between India’s needs and the UK’s offering. It was very positive to hear that Prime Minister Narendra Modi highlighted the centrality of sectors such as manufacturing, infrastructure, energy, pharma, space, and defence, to global cooperation. These are all areas ripe for India-UK collaboration in creating Aatmanirbhar Bharat, underpinned by both nations’ strong track record in technology and innovation. In manufacturing for example, the UK already has a great presence in India, with the likes of Perkins Engines, JCB, BAE Systems, GlaxoSmithKline and Rolls Royce well established, and appetite for more.

How important is India in the UK's plans of engagement in a post-Brexit world ?

"At JETCO, senior Government officials welcomed the positive trend in UK-India trade, which saw trade top £24 billion in 2019 with a 10 per cent growth over 2018 and set targets to make that even greater. India is a key priority for trade and investment of the UK Government, and for UK businesses, as a large and growing market.

The introduction of the UK’s new point-based immigration system and Graduate Immigration Route will make it easier for Indians to come to work and study in the UK, helping to further the already strong ties between our countries. Accordingly, we expect to see this result in growth in UK-India trade.

What are UKIBC's suggestions on improving ease of doing business?

In each of the five past years, UKIBC has produced its Doing Business in India Report which complements the World Bank’s Ease of Doing Business rankings. And every year we have found that the top barrier to doing business in India is legal and regulatory impediments. Improvement in the bureaucratic processes  was subsequently the most desired reform, as articulated  by 28.6 per cent of respondents. More transparency, consistency and equanimity in the application of law and regulations would be a great way forward.

How do British businesses view the ‘Aatmanirbhar Bharat’ policy being espoused by India?

Finance Minister Nirmala Sitharaman has said that Aatmanirbhar Bharat means integration, not isolation, and we at UKIBC have had similar reassurances from senior Government representatives in recent engagements. The UK’s rich research and development ecosystem, and world leading technology can be hugely beneficial to Aatmanirbhar Bharat and contribute to India’s objective of becoming a global manufacturing powerhouse.