Open for business, Britain seeks new partnership with India

MUMBAI - Britain Wednesday declared it is “open for business” with India and announced that Exim Bank will be granted a licence to operate in the country and the State Bank of India will base its European headquarters in London.

“I would like to see Indian banks establishing themselves even more prominently as big players in City of London and throughout the UK,” Chancellor of Exchequer John Osborne said.

He called for greater Anglo-Indian cooperation between financial services industries that would bring benefits to the two countries.

Osborne announced that the Exim Bank has been given a license from the Financial Services Authority (FSA) to set up bank in Britain, making it the 10th Indian bank to establish presence in the country.

“I can also announce that the State Bank of India, the oldest commercial bank in this country (India), will be making London their European headquarters this year and will be adding to their network of branches across the UK,” he said.

Osborne also asked India to further liberalise its financial services market.

Expressing concern that Britain and India have slipped on the trade front, Osborne said he wanted to see completion of a free-trade agreement with Europe.

“In 2008, India was only the 19th most important source of foreign goods for the UK market and the 12th most important source of services.”

“A decade ago, the UK was India’s fourth most important source of imported goods. By 2009, we had failed to being the 18th largest.”

“We could and should be doing much more with each other,” he said.

Osborne also mentioned that while Britain’s investment is the fourth largest in India, its share of foreign direct investment has been declining.

“I want to change that,” he said.

“I also want to see British banks doing more to help India increase its financial capacity so that access to capital is not a brake on India’s economic growth,” he added.

Earlier in the day, Osborne rang the bell to start trading at Asia’s oldest stock exchange, the Bombay Stock Exchange, and hoped that a new partnership with India would be initiated.

“It is a historic day as I am opening the trading at Asia’s oldest bourse-Bombay Stock Exchange… We are here to forge a new economic and cultural partnership. We are here to declare Britain open for business with you.”

He said Britain has a “vital stake” in India’s rise to global power and prosperity. “And we are here to listen and learn to find out how our strong relationship can grow stronger still.”