Largest ever overseas investment in India – by a British company

In February I took part in five workshops, from Edinburgh to Newmarket, and Leeds to London.

These workshops were arranged and supported variously by UKTI, the Asia Task Force, RBS and The Economist Intelligence Unit about India. From the number of businesspeople who attended at each venue, probably over 500 in all, I was left in no doubt that interest among UK business in India must be at an all time high. The UK India Business Council’s annual meeting, which takes place in Manchester in March, is also attracting record numbers, and we have trade delegations in Mumbai also in March representing about 50 companies.

As well as Indian speakers from RBS’s operations in Mumbai I was helped enormously at some of the seminars by UK companies who have started to do business in India. Dr Will Pythian from Nuvia, a company working in the civil nuclear field, and Scott Duncan, Indian Project Manager of ClydeUnion, manufacturers of pumps, described how they had both, through a series of visits and a good deal of patient persistence, formed partnerships with Indian companies to secure a foothold in the market. They both emphasised that that it was, from their perspective, essential to form an agreement with an Indian partner.

Only days after these workshops, BP illustrated the partnership route dramatically, with an announcement in London, witnessed by The Chancellor of the Exchequer, that they had agreed a 30 per cent share in an oil and gas joint venture with one of Indian’s largest conglomerates, Reliance Industries, whose chairman is Mukesh Ambani. It was appropriate that the Chancellor was at the signing, as he had called on Ambani during his visit to Mumbai with a business delegation in July, before joining the Prime Minister in New Delhi. The contract will be worth initially about $8bn, and is by some way the largest ever overseas investment in India.

Some of the media and other observers had questioned, when Business Secretary Vince Cable visited Mumbai in January, why the UK had not announced mega business deals after the Prime Minister’s visit, making comparisons with  trips here by Presidents Obama and Sarkozy which had been accompanied by stories of multi-million deals. The Business Secretary counselled patience, and cautioned against inflated estimates.

Hopefully the BP-Reliance deal will silence doubts about the scale of UK interests in India – as will, in the longer term, business by just a fraction of the 500 British companies who took the time to attend the workshops around the UK in February.