January
11, 2008 UK-India a
Match Made in Heaven,
says British Trade Minister By Dipankar De Sarkar
London
A quarter of a century after Japanese car companies boosted
Britain's economy under Margaret Thatcher, India is being seen as
the country that could do an "encore", with Britain's minister for
trade and investment saying that the next generation of investment
wouldn't be powered by a Nissan, "it's going to be a Tata".
Lord Digby Jones arrives in New Delhi Monday with a power-packed
delegation representing 60 major British companies, 26 of them from
the car industry. The visit is in two stages: the first is to focus
on striking business deals in automotive, infrastructure and
environmental industries and the second will follow as part of Prime
Minister Gordon Brown's delegation.
Jones, whose background is in business, wants Indian companies led
by the Tata Group to bring the "second generation of inward
investment" into Britain - just as Japanese carmakers did 25 years
ago during the Thatcher years.
"If you look at Nissan, opening in Sunderland in 1983 - 25 years ago
- within three or four years and within four miles of the plant, the
top 10 auto component manufacturers in the world were there, making
bits and selling them to the Nissan factory," Jones told IANS in an
interview.
"Not one was an Indian or Chinese company. They were large American,
German and Japanese companies, and they created huge investments in
Britain - lots of jobs - paid corporation tax, built schools and
hospitals.
"What we are looking for is an encore to that success story. I would
call it the second generation of inward investment into this
country."
Nissan's setting up in Britain was a major economic success story of
the 1980s, following sweeping economic reforms introduced by the
ruling Conservative Party under Prime Minister Margaret Thatcher.
The keys to the first car that rolled off the Sunderland plant were
given to Prince Charles and Princess Diana.
Although the 25 years since then have seen the sell-off of Britain's
best-known car models, including Rolls Royce, MG Rover, Lotus,
Jaguar and Land Rover, the car industry itself has been roaring
under foreign ownership - partly as a result of Thatcher-era reforms
such as a single union representing all workers in a plant.
Now, says Jones, India and Britain ought to forge a new partnership
in manufacturing, which would be based upon the knowledge economy
and complementary skills.
Giving the example of the tie-up between Britain's Ultra Motor and
India's Hero Group to produce environment-friendly electric mopeds
in India, Jones said he wants to do the reverse so that Indian
companies can set up in Britain and manufacture for British
companies.
Taking what he calls a "rifle rather than shotgun approach", he has
targeted India's Rico Auto Industries to spearhead such a move, with
Tata Motors poised to buy out the British marques Jaguar and Land
Rover from the US company Ford.
"What we want to do is get Rico to bring their expertise and their
knowledge to Britain. When you read, as I do, that Tata may well buy
Jaguar, and they own Corus, and the major component of a motorcar is
steel, you've got to start thinking to yourself, 'there's something
made in heaven here - a match'," Jones said.
"What I'd love to happen is that Rico makes things in Britain and
sells them to Tata in Britain - you need a launch."
"I want Tata to be followed by components manufacturers, and
companies that train people, just as 25 years ago they all followed
Nissan into Britain.
"The next generation isn't going to be a Nissan, it's going to be a
Tata," Jones added.
The British minister will focus on two other areas during his stay
in India - Britain's expertise in raising finance through 'public
private partnerships' (PPP), particularly for India's infrastructure
sector, and British green technologies that he said could be
financed through multilateral agencies.
However, Jones said Indian protections in the legal, accountancy and
banking sectors presented a "blockage" toward raising private
finance, pointing out that India granted only 12 licences for
foreign banking operations in all of 2007.
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