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UK investment in India between 2000 & 2016 approximately $24.07 billion
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Saturday, 25 February, 2017, 08 : 00 AM [IST]
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London
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Between 2000 and 2016, the United Kingdom invested $24.07 billion in India – increasing its investment by $1.87 billion between 2015 and 2016 – representing eight per cent of all foreign direct investment (FDI) into the country.
It also managed to see off tough competition from Japan to remain the largest of all foreign investors into India after Mauritius and Singapore, and significantly ahead of the United States.
British business interests in India span a broad spectrum, both in terms of firms – with several medium-sized businesses taking their place alongside larger companies to do successful business – and sectors, with India attracting investment from industry to services.
The chemicals sector is the recipient of the lion’s share of British investment in India at $6.1 billion (25 per cent of UK FDI), followed by drugs and pharmaceuticals at $4.1 billion (17 per cent) and food processing at $3.2 billion (14 per cent).
The top reasons British firms invest in India are the size and growth potential of the market, the easy availability of talented workers and the stable political system.
The UK also remains the largest job creator in India via FDI. Between 2000 and 2016, British FDI created 371,000 jobs – 10 per cent of all jobs created by FDI. The total number of people employed by British companies in India currently stands at 7,88,000 – representing 5.3 per cent, or one in twenty, of private sector jobs.
Carolyn Fairbairn, director general, Confederation of British Industry (CBI), said, “It’s really encouraging to see the vibrant economic relationship between India and the UK continues to flourish.”
“These figures reflect the thriving commercial links that Britain’s businesses – large and small, and from a whole host of sectors – have built in India, and which prime minister Theresa May saw on her first visit outside the European Union (EU),” she added.
“From strengthening the UK’s leading position as the largest G20 investor in India to being the biggest Indian job creator through direct investment, it’s clear the country is a magnet for British firms,” Fairbairn stated.
“As UK companies grow, they also create jobs and drive prosperity here at home. So, as new opportunities spring up in India – from its rapid digitisation to more young people wanting to study at the UK’s world leading universities – our firms will be looking to take full advantage,” she added.
“Further reductions in India’s corporate tax rates and improvements to the ease of doing business will see the relationship between India and the UK go from strength to strength,” Fairbairn said.
Kevin Burrowes, executive board member and head of clients and markets, PwC UK, said, “India offers excellent opportunities for UK businesses looking to engage in a fast-growing emerging economy. Building ever closer business ties with India will be critical, especially at this current time, given the changing global and European stage.”
“It is encouraging to see that confidence among British and Indian business leaders has increased in comparison to last year. According to PwC’s latest CEO Survey, 75 per cent of Indian CEOs are very confident about their companies’ prospects for revenue growth over the next three years, compared to 41 per cent globally, adding to India’s attraction as a place to invest.”
Patricia Hewitt, chair, UK India Business Council, said, “It is great to see the UK solidifying its place as the number one G20 investor and job creator in India through FDI.”
“The Indian government’s efforts to improve the business environment are clearly bearing fruit, and British businesses of all sizes and from across sectors have continued to spread right across this exciting and fast-changing market,” she added.
“The bilateral business relationship is certainly strong, and it is important to both economies. The fact that the prime minister’s visit to India in November was her first bilateral destination showed how much India matters to the UK,” Hewitt said..
“Indeed, the findings of this report also show how much the UK matters to India in terms of investment and job creation. As prime minister Narendra Modi said, ‘The UK and India are an unbeatable combination.’”
UK investment continues to be spread across India, with significantly more firms choosing to invest in Delhi of late. Between April 2015 and September 2016, nearly a quarter (22.35 per cent) of British investments went to Delhi. The state of Maharashtra, with the city of Mumbai, attracted the largest share of British investment ($7.47 billion) between 2000 and 2016.
Sterling Assets India 2 also marks the start of a series of events between the CBI and the UK India Business Council, focusing on the future of the UK-India trade relationship, which will take place in both the UK and India over the next two years.
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