POLICY PROFILE: A Manifesto for Boosting UK-India Business

The world′s largest democracy has just held the world′s most exciting election. Expectations of Narendra Modi are sky-high - from the poorest voters who have given him a stronger mandate than any Indian government has enjoyed for decades to the wealthiest business leaders who bank-rolled his campaign. But the election result is also good news for UK-India relations.The size and importance of Britain′s Gujarati Diaspora - and the part many of them played in his election victory - give Prime Minister Modi a special connection to the UK. Furthermore, the UK led the way in lifting the EU-wide embargo on Mr Modi, imposed after the anti-Muslim riots in 2002. The High Commissioner, Sir James Bevan, and I led a business delegation to the Vibrant Gujarat Conference in January 2013. We had a private meeting with Mr Modi, and he spent over an hour with business colleagues and myself. (It probably helped that, as a former Leicester MP, I made much of my speech in Gujarati!). Compared with US hostility, the British government′s attitude was noted and appreciated.The election result itself will have a direct impact on business and consumer confidence, helping to kick start growth. But we can also expect early action to deliver on Mr Modi′s pledge of “less government, more governance”, with a smaller Cabinet tasked to deliver transparent, accountable and clean government. Fast approvals are likely on major infrastructure and power projects stuck in Delhi′s bureaucracy.Expect a solution of some kind to the retrospective tax issues that are causing such grief to Vodafone and many other major foreign investors, probably with an announcement in the Budget that is due within a few weeks. Major tax reforms will follow, including the introduction of nationwide GST, probably within two years. And alongside Indian business leaders, we will press hard for a solution to the food labelling problem that is stopping many British food products - highly popular with India′s growing middle class - reaching the market.With tens of millions of young Indians desperate for jobs, the new government will step up investment in skills and employability, and in job-rich sectors: manufacturing, tourism, food production and distribution.All this is good news for British businesses, large and small, that are already in India or looking to expand there. In fact the UK is one of the largest investors in India, with companies like Standard Chartered and JCB so long-established there they are as much Indian as British. Yorkshire-based shoe company, Pavers, was the first foreign company to take advantage of 100 per cent foreign direct invetsment (FDI) in single-brand retail: its shops now greet you in India′s major airports and city shopping centres. High-end cosmetics and beauty firm, Urban Shore, is appealing to India′s growing middle-class, along with famous names like Marks and Spencer, Burberry and Truefitt and Hill.The disappointments of the last five years have reinforced negative perceptions about India. Narendra Modi′s election - and the better business environment that will undoubtedly follow - means that now is the time for British business to seize the India opportunity with both hands.Patricia Hewitt is the Chair of the UK India Business Council (UKIBC), a business-led organisation that works with the British government to promote bilateral trade between the UK and India. She has the distinction of being the longest-serving UK Secretary of State for Trade and Industry in the last 50 years. The above article was published in India Inc′s print edition of the India Investment Journal launched in June 2014 in conjunction with the India Inc Seminar: A new dawn for India - What does it mean for UK-India Business