The coloniser’s conundrum

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To recover, cash-strapped UK must make India its most favoured destination

BRITONS HAVE made a national sport out of saying the country is going to the dogs since they handed India back in 1947,” wrote a journalist for the National Post during the recent British general election campaign. Given that the United Kingdom is in a financial crisis, and both the European Union and the US fear ruin, will the new UK government realise the centrality of India’s role in furthering British interests?

In the UK, if you want to know what a politician will do, ignore the speeches. Instead, read the annual speech Her Majesty makes at the start of every Parliament session, outlining the legislation her most loyal government plans to enact into law. According to that speech, the government’s first priority will be to “reduce the deficit and restore economic growth”, and to “accelerate the reduction of the structural budget deficit”.

The UK government needs to allocate more resources to its investment, trade and defence policies in India

There is no surprise here. On foreign policy, the government, among other things, will seek “lasting security and stability in Afghanistan” and “an enhanced partnership with Pakistan and India”.

Matchmaker
David Cameron, the new PM

David Cameron has vowed to build a “new special relationship” with India, which he sees as a potential major political and trade partner. He said the same in 2006 during his first trip abroad as the new Conservative Party leader. He wrote on his blog: “…As the world’s centre of gravity moves from Europe and the Atlantic to the south and the east, I think it’s time for Britain and India to forge a new special relationship for the twenty-first century.”

The mathematics is simple: British firms need investment returns offered by India that they simply can’t get at or near home. Britain has a burgeoning trade deficit. It needs to create jobs. Having Indophile Vince Cable as Business Secretary will surely help.

The problem lies in the gap between the ideas and their execution. The UK government needs to allocate more resources in India to its foreign policy, defence and trade and investment policies. If countries can be thought of as companies, then Britain should follow the lead of virtually every S&P 500 and FTSE 100 company which have done exactly that — put more people on the ground in India.

According to a UKIBC NRI survey 97.6 percent thought India’s business potential was good or excellent, and 85.7 percent felt the recession made investment in India more attractive. But shockingly, 61 percent said it was not easy to enter the Indian market.

The answer for a cash-strapped UK is not to simply leave it to the private sector. British business needs the help of Vince Cable’s business ministry to penetrate the Indian market.

It helps that Britain’s geo-economic location within the EU and links with the US make it an ideal ‘go global’ base for Indian companies.

When one considers India’s neighbours, the on-and-off democracy of nuclear-armed Pakistan and of Communist China — coupled with India’s strong relations with Russia and Iran — it again becomes clear why India is so important for Britain’s national security interests.

Yet it was only in 2006 that the RAF and IAF held their first ever joint exercise. Britain needs to seek as close a tie in foreign policy co-ordination with India as it does with the US.

And that will be the test for Her Majesty’s government if it is not someday to regret ‘giving up India’. But for that to happen it will need to do a great deal more. It will need to have a practicable format in place to turn word into deed.

WRITER’S EMAIL
a.patel@praefinium.com

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