India; Lord Mayor's visit
Published 7 January 2015
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0.1 This publication was archived on 4 August 2016.
This article is no longer current. Please refer to Overseas Business Risk - India.
0.2 Summary
The new Lord Mayor of London visits India to promote UK financial and professional services and lobby for improvements to the overall business environment. He witnesses progress on opening up the Indian insurance market - an encouraging example of liberalisation.
0.3 Detail
In his first overseas visit as Lord Mayor, Alderman Alan Yarrow visited Delhi and Mumbai 6-10 December for an intensive five day programme.
In Delhi the Lord Mayor spoke at a major event run by the Economic Times, emphasising the need for reform in the legal services sector in India (currently closed to foreigners) and the key role the UK can play in providing the capital and skills for Prime Minister Modi’s efforts to transform India. The Lord Mayor expanded on this in a 30 minute interview on India’s most watched business channel.
The long-awaited Insurance Bill raising the FDI limit to 49% cleared its Committee Stage during the visit: the Lord Mayor congratulated Finance Minister Jaitley on this and plans for wider economic reform. Jaitley said India had much to do to improve the business environment and translate optimism into results. The ‘Make in India’ campaign and rapid improvement in infrastructure were key planks of that reform, but improving financial flows and securing more foreign investment would be critical
Commerce Minister Sitharaman said the government was making progress on reform. She was determined to increase exports, which were far too low, and to improve India’s lowly 142nd place in the World Bank’s ease of doing business ranking.
In his meeting with the Chairman of the Securities and Exchange Board of India (SEBI), the Lord Mayor encouraged further opening up of India’s capital markets. (The Rupee is still not fully convertible, so that adds friction to the issuance of debt internationally). The Deputy Governor of the Reserve Bank of India noted that Indian banks were being encouraged to limit their own exposure to corporate debt which should produce greater demand for foreign lenders.
The Lord Mayor undertook several other engagements to promote UK business. He struck one of the first new gold Half-Sovereigns being produced by the Royal Mint here for the Indian market; spoke at events run by Thomson Reuters, Said Business School, and the Chartered Institute of Securities and Investment; and gave a presentation to Mumbai’s top business-focussed University College.
0.4 Comment
The timing was good, with the new government starting to focus more on its need to engage with the financial and professional services industry. The Insurance Bill passing its committee stage during the visit was good news for both sides: the UK will be the biggest international beneficiary of the change, with Lloyd’s being able to enter India and other UK insurance firms being able to increase their investments.
0.5 Disclaimer
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