The imbroglio surrounding British telecom major Vodafone Plc’s tax case seems far from over and has become a sticky point in the India-UK relations. But Vince Cable, UK’s secretary of state for business, innovation and skills told Nayanima Basu in an interview, the British government trusts the Indian judicial system will come out with a probable outcome. Edited excerpts:
You met commerce and industry and textile minister Anand Sharma and minister for human resources and communications and information technology Kapil Sibal. Did you discuss Vodafone’s tax case in India, which has become an issue in India-UK relations?
It is a matter of some concern. But the key decision that is being made through the Supreme Court, is a legal problem now. The Indian judicial system is independent and of very high quality. The company will presumably pursue its claim in the courts. But that is up to them. We will support them if required. But we primarily see it as a legal problem and trust the Indian judicial system will produce a good outcome.
The British government has made some changes to the student visa regime. Do you not think this will act as a major deterrent, especially because Indian students still view UK as one of most credible destinations for studying abroad?
I hope not. There is certain amount of negative propaganda. When people say Indian students are not welcome to UK, it simply is not correct. We are very clear that students are not immigrants and they are welcome as overseas students. If they want they can work for two years after graduation. But we also do not think it is right for people to do degrees in British universities and then after the graduation do some menial work and directly compete with local workers. But there is no problem if they are doing graduate employment.
You saw what happened with the decision of allowing foreign direct investment in multibrand retail trading. How do you view this in the backdrop of India-UK bilateral relations?
There is obviously more to do. But at the same time I also know it is a democratic country and even in UK I have seen how difficult it is to put through reforms that affect people.
The whole point about multibrand retail is it would be in India’s interest. Some of the top global retail companies have very good systems that would cut out waste in the distribution system. They have got good operating methods and it would be good for the farmers because they would get better and more stable prices. It will be good for consumers.
But I also understand India has a lot of traders who would face competition and worry about it. The decision basically needs political momentum.
Are you planning to have a separate bilateral trade deal with India or hoping to benefit from the proposed India-EU free trade agreement (FTA)?
We, in EU pool, are trade negotiations. We negotiate as a group. From the UK point of view, what we are looking to see is opening up of some of the services sector in India like insurance and legal services. But these things are not straightforward and require legislation. We are also keen on cars and other such things in the FTA.
What was the purpose of your visit this time? I believe you have brought a delegation of small and medium enterprises (SMEs)?
I did not bring the delegation, but they happened to be here. Our SMEs have not really engaged with India and, especially with big companies. But it is now beginning to happen.
