British PM pitches for jobs, trade in India

"I want this to be a relationship which drives economic growth upwards and drives our unemployment figures downwards," Cameron declared in a speech in the Indian IT hub of Bangalore.

 

"This is a trade mission, yes, but I prefer to see it as my jobs mission."

 

Accompanied by a bevy of top ministers and a small army of business leaders, Cameron arrived late Tuesday at the head of the largest British delegation to travel to the former jewel in its colonial crown in recent memory.

 

It has been tagged as a mould-breaking mission to redefine what Cameron's government sees as a long-neglected relationship with one of the world's fastest-growing economies.

 

The trip kicked off in the southern city of Bangalore, where Cameron visited the country's second-largest software exporter Infosys and the state-run defence giant Hindustan Aeronautics Ltd. (HAL).

 

Among a raft of trade agreements to be signed during the visit, the expected highlight is a deal worth up to $650 million for BAE Systems to supply 57 more Hawk trainer jets.

 

India ordered 66 Hawk jets from BAE in 2004. All the aircraft in the follow-up deal will be jointly assembled locally with HAL.

 

Cameron highlighted the recent investment in Britain made by Indian-run companies such as the car maker Tata and steel group Arcelor Mittal, but also pushed India to open up its tightly regulated domestic market.

 

"We want you to reduce the barriers to foreign investment in banking, insurance, defence manufacturing and legal services -- and reap the benefits," he said, adding that a new global free-trade deal was vital.

 

Since taking power in May, Cameron has said he wants British foreign policy to focus more on business in a bid to boost the economy as it emerges from recession facing deep budget cuts to combat record state debt.

 

Apart from a trip to war-torn Afghanistan last month, the visit is Cameron's first major foray to Asia. The choice reflects India's growing regional clout and its emergence as an investment destination to rival neighbouring China.

 

Among the BRIC group of emerging economies -- Brazil, Russia, India and China -- India is seen as one of the largest, most culturally compatible and under-exploited markets for partnerships with British firms.

 

One of the first countries to shrug off the effects of global financial crisis, India boasts a growing, consumer-hungry middle class and an economy that is forecast to grow 8.5 per cent this fiscal year.

 

"This is the beginning of an enhanced relationship," Britain's finance minister George Osborne said after ringing the bell to start trading at the Bombay Stock Exchange on Wednesday.

 

"The relationships are good and historic but can be made stronger," said the chancellor of the exchequer, who is accompanying Cameron along with Foreign Minister William Hague and Business Secretary Vince Cable.

 

Ties between the two countries go back a long way.

 

India was known as the "jewel in the crown" of the British empire until independence in 1947 and up to two million people of Indian origin live in Britain, its largest ethnic minority group.

 

Bilateral trade was worth 11.5 billion pounds (13.7 billion euros, $17.7 billion) last year.

 

"Cameron's visit is a clear signal: Britain is wooing India," said R.K. Jain, a professor of European studies at Jawaharlal Nehru University in New Delhi.

 

"Britain wants to attract high-ticket investment from India. They are fighting a deep financial crisis and acquiring foreign direct investment is one of the best ways to improve that," he said.

 

But Britain is not alone in paying court to its former colony, and faces competition from much bigger trading powers such as the United States and Japan -- a point Cameron conceded in his speech.

 

He said he would make his case for closer economic ties "knowing this country has the whole world beating a path to its door."