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UK keen to deepen ties with Narendra Modi regime: Greg Clark

LiveMint logoLiveMint 12-04-2017 Gireesh Chandra Prasad

The UK under prime minister Theresa May is keen to strike deeper trade and investment ties with India as the island nation prepares to leave the European Union. In an interview with Mint, UK secretary of state for business, energy and industrial strategy Greg Clark, who was in India last week for the first bilateral energy dialogue, talked about closer engagement between the two nations and concerns among businesses regarding Brexit. Edited excerpts:

What is the scope of the energy dialogue and the planned enhancement in strategic partnerships with India?

We spoke on renewable energy in general and specifically on smart grids, clean energy financing, research and development and skills.

There is great enthusiasm and momentum in our relationship. The fact that I am here at present, the chancellor of the exchequer (Philip Hammond) was here earlier in the week and that defence secretary (Michael Fallon) will be here shortly, indicates that. The Prime Minister’s first engagement outside Europe was in India last year which shows the importance we attach to our bilateral relationship. It is so evidently reciprocated.

The Indian side could not have been more warm and encouraging. I think, in all areas, we expect to expand and deepen ties. In the energy dialogue, we agreed to drive progress on the deliverables. We would keep tabs on the investments taking place. Power minister (Piyush Goyal) made the commitment that $1 billion worth of masala bonds will be issued in the UK. Regulations that foster innovation is another area of co-operation.

We have always ensured that our regulatory arrangement encourages innovation—for example, the policy environment for smart grids to make sure the right incentives are in place for users and suppliers. That is something we have agreed to share. The bilateral relationship is already deepening. That is the ambition that we pursue. It goes hand in hand with the approach of the government of India which is pacey, ambitious and eager to see momentum.

Many Indian entrepreneurs are headquartered in the UK. How are they placed as Britain prepares to leave the European single market?

We are very positive about the prospects for a good agreement with our friends and neighbours in the EU. The reception to our prime minister’s letter setting out the negotiating ambitions has been constructive. The prime minister has made it clear that we want to have a very deep and special trading relationship with our neighbours.

I am very optimistic that we will come to a satisfactory agreement with our neighbours. In the meantime, the prospects for the British economy and the fundamentals continue to be very strong. The industrial strategy is to lay out long-term areas of policy action which will further boost our attractiveness. Research and development is an area in which we have a strong reputation.

We are investing £2 billion a year more in publicly-funded research and development. That is available to companies that locate and work in the UK. We have an open and a modern economy. Our ambition to further develop international relationships beyond the EU is also palpable. The number of my cabinet colleagues who have visited India over the last few months underlines the momentum behind the deepening and broadening of trade relationships. It has been a source of delight to me to see how much that is reciprocated by my counterparts in India.

What is your government’s position on movement of personnel, especially of skilled workers and students from India to the UK?

Movement of personnel is important and the energy sector is a good example. People with expertise and talent required in international businesses should be able to put to use those talents in the UK. While the referendum debate reflected a strong desire to be able to take control of our immigration system with respect to the EU, no part of that debate suggested any reluctance or resistance to having people with skills and technical abilities that are international in application to be able to come and work in the UK.

That strongly remains my view and the view of the government. There has been an increase in Indian students in UK universities. (Last year, UK issued over 11,300 Tier 4 general students’ visas to Indians , a 2% increase over the previous year, according to information from the British High Commission).

There is no cap on the number of international students. In fact, one of the messages that I am always keen to send out is that our universities are open to the brightest and the best in the world. We have benefited hugely from the participation of Indian students.

India is on an ambitious clean energy expansion drive. But technologies for low carbon economic growth are expensive. How can the UK government facilitate technology transfer on affordable terms?

This was part of our discussions. One of the important areas of collaboration is in research and development. The associations between India and UK universities in research is substantial and is increasing.

During my time as science minister, we had launched a number of initiatives to deepen such collaboration and it continues. Technologies developed by UK companies are, of course, available to Indian companies through licensing agreements so that they can be deployed locally. We are very keen to make those available and to promote them.

India has been trying to monetise its offshore hydrocarbon reserves for two decades with mixed results. UK has a well-established offshore hydrocarbon industry in Aberdeen. What are the possible areas of hydrocarbon co-operation?

This is my second engagement with petroleum and natural gas minister Dharmendra Pradhan, who had earlier visited London and Aberdeen. We talked on a number of issues, including natural gas and the increasing role of gas in the Indian economy. British companies are very keen to be part of the opportunities in the Indian market.

A major part of the discussion was on UK firms’ investment opportunities in India’s hydrocarbon sector. Also, equally encouraging is the interest among Indian companies to invest and operate in the UK. We do have the knowhow of offshore hydrocarbon exploration and production. That expertise is already being exploited to train people locally, based on our experience in the North Sea.

A key factor that has affected every business globally in the resources as well as the manufacturing sectors is the excess capacity in China. What is your government’s position in protecting your local industry, where many Indian businesses have significant operations?

We believe that we are an open economy. We believe in free trade and in international systems such as the WTO through which decisions can be made as to what is the right regime in any particular country. We strongly believe in rules-based international system. We find that the UK is competitive in lots of areas and actually the performance of businesses, domestically owned and owned by Indian groups, has been strengthening.

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