'Britain wants enhanced trade with India but red-tape hurts'

Thursday, 09 October 2003, 19:30 IST
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NEW DELHI: British businesses are still wary about investing in India despite a 16.5 percent increase in bilateral trade this year, largely due to the country's long-winded official procedures and a slow bureaucracy, Britain's outgoing envoy has said. At the same time, strains caused by the loss of British jobs due to firms transferring part of their operations to India do not have the potential to become an irritant in trade ties, British High Commissioner Rob Young said. "There are still some apprehensions about doing business in India, in the sense in which it can take a long time to set up a new investment, the bureaucracy can be slow," Young told IANS in a farewell interview. "That is improving and some states have found a more direct route, what is called the single-window approach, and are proving more effective in attracting investment than other states," said Young, who leaves India on October 12 at the end of his tenure. The British envoy said he would like to see this sort of "best practice adopted by all states in India to maximise the opportunity for investments". Bilateral trade reached a record level of five billion pounds in 2000. The figure remained roughly the same for the next two years but during the first six months of this year, it increased by 16.5 percent over the corresponding period last year, he said. Asked if the loss of British jobs due to firms transferring operations to India could become an irritant, Young said: "I don't think so. "The trade unions in Britain are naturally worried about job losses. But the key point is for British firms to remain competitive. If they go out of business, all the jobs would be lost. "If they think the best way to remain in business and do good business is by setting up call centres and back office operations in India or elsewhere, then they must surely do so." Young said he expected this trend to continue and "so far as it enables firms to grow, that could well lead to new jobs being created in Britain". "Meanwhile, we in Britain have to retrain our people and give them higher value jobs, higher skill jobs up the value chain," he asserted. Referring to the strong new trend of growth in bilateral trade, he said, "I think services are going to develop even faster than trade in goods and that will form a larger proportion of the total as we move ahead." At the same time, investments in both directions had grown in recent years. "There is a lot of investment going on from Britain to India in a number of sectors, not least in the oil and gas sector. We've got British Gas, BP, Shell, all busy here," he said. "Indian investment in the other direction is mushrooming. We have 450 firms from India now operating in Britain. "That's increased more than three-fold in the past five years and it's a recognition of the strength of the British economy and the way in which Britain can provide the best platform for working in the rest of Europe." Young said more could be done to bring home to potential British exporters "the success stories that have already taken place in their sectors". Asserting he had a "deep-rooted conviction" that India would become a very influential country on the world scene in the next 50 years, he said India should apply the skills and assets it has used to develop new industries like IT, pharmaceuticals and biotech to traditional sectors. "India can be an economic world beater in every sector if the right environment is created," Young said.
Source: IANS
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