Settle Vodafone issue once and for all: ASSOCHAM
New Delhi, Feb 19 : With recession like situation in most parts of Europe, India offers excellent opportunity for investment particularly in the infrastructure sector for the British companies, ASSOCHAM said.
The chamber made this comment at a time when British Prime Minister David Cameron is on a visit to India.
Besides, the long-drawn Vodafone dispute should also be sorted out so that a big irritant is removed from the policy space. "While the British Prime Minister is expected to touch upon the Vodafone issue with the Indian authorities, the Indian industry would be pleased to see the end of the vexed issue so that no more negative perception is carried abroad," ASSOCHAM President Rajkumar Dhoot said in a statement here.
As for the bilateral trade and investment engagement, Dhoot said while the cumulative figures are positive, the pattern needs to become more stable and sustainable.
Although UK has emerged as the third largest source of foreign direct investment (FDI) for India, bulk of the cumulative inflows of USD 17 billion from that country were seen in fiscal 2011-12 because of a couple of big deals, he said.
In 2011-12, FDI from UK aggregated to USD 7.87 billion as against USD 2.71 billion in the previous year. For the current fiscal up to November (from April) the inflows are less than a USD one billion.
"We need to somehow sell the India story to the British investors, when Mr Cameron arrives here and engages with the top Indian leadership and business leaders along with a high powered delegation," said Dhoot.
He said while Britain is home to some of the biggest financial companies in the world, it is in the area of infrastructure like power, roads, ports and airports that India should make concerted efforts to woo them.
"These infrastructure areas offer ready market for India where wide gaps exist. However, what we must assure the global investors is a conducive policy environment in terms of clear cut rules and guidelines, whether in the public-private partnership or in the standalone projects," he said.
Dhoot said, "We must get, once and for all, the Vodafone tax issue behind us. It has dragged too long for our comfort and the comforts of the global investors. We need to settle it fast so that a strong message is sent to the investors that the commercial disputes can be settled in a transparent and timely manner".
In terms of trade, the bilateral trade is USD 15 billion. "We should jack up the trade target as well and fix an ambitious milestone of USD 50 billion for the next three to four years," said Dhoot.
He further it is a matter of great satisfaction that the outward FDI to Britain has significantly shown a mark up with the Tata group taking the lead in the automobile and steel. The Tata-Landover and Jaguar and Tata-Corus deals were landmark in the India-UK investment.
He said several more such opportunities exist in the areas of education, banking, Information Technology, defence equipment and retail.
"Now that India has opened FDI in muti-brand retail and 100 per cent foreign equity is permitted in single brand retail, the British industry and political leadership should be prevailed upon to bringing in investment in these growing areas," he said.
The ASSOCHAM said it has been in the forefront of promoting India's economic engagement with UK as the two nations have historical business relations which can be revived.
"In fact, the British companies operating in India had a major role in promoting ASSOCHAM way back in 1920," chamber Secretary General D S Rawat said.
He said India and its economy has come a long way since Independence and our business leaders and the country has a self confidence to engage with the global industry on equal and respectable terms.
"We should try and make the best use of Mr Cameron's visit," Rawat said.