UKIBC Report Launch – How the UK can Make in India

By Oliver Rice

The UK India Business Council is delighted to launch our latest report ‘How the UK can Make in India’ at a roundtable of some of the UK’s largest advanced manufacturing and engineering businesses with Invest India today.

How the UK can make in India: Growing UK Advanced Manufacturing and Engineering Investment in India

This report, grounded in extensive consultations with our members, makes the case for how the business and operating environment in India can be improved to meaningfully grow UK manufacturing investment and jobs.

India is expected to become the fifth largest manufacturing country in the world by the end of 2020 with advanced manufacturing and engineering forming a central pillar in the Government of India’s economic vision.

Keynote initiative ‘Make in India’ aims to make India a high-value and efficient global manufacturing hub where Manufacturing generates 100 million jobs and 25% of India’s GDP by 2022, up from 16% currently.

India’s strategy is rightly about quantity and quality, with hi-tech manufacturing and industry 4.0 at the heart of Make in India.

This is already bearing fruit with global giants including Perkins Engines, Rolls-Royce, JCB, BAE Systems, and Renishaw all setting up manufacturing plants in India, attracted by growing skills, an expanding market, and the growing potential of India as an exporting hub.

For Make in India to be a full success however, it will require a significant gear-change in India’s economy. It will not be enough for India’s manufacturing sector to grow with the economy – it must drive the economy.

In helping to achieve this, the UK stands to be an important and strategic partner. The UK’s expertise closely aligns and compliments India’s manufacturing and engineering ambition to develop a clear comparative advantage in high-value, efficient production.

The UK’s advanced manufacturing and engineering offer is grounded in research and innovation. Consistently in the Global Innovation Index top five, the UK is home to the most productive science base in the G7 with a technology sector larger than the rest of Europe’s combined.

The UK’s automotive sector is Europe’s largest investor in research and development with supply chains embracing digital technology to deliver productivity gains, innovative products, quality improvements, greater flexibility, and shorter times to market.

Likewise, the UK’s aerospace sector is the second largest in the world, with a GBP 31 billion annual turnover and employing 250,000 people. Home to global giants and over 3,000 further companies, the UK’s aerospace supply-chain is mature and dynamic. This is matched in the defence sector, which is the world’s second largest defence exporter, experiencing 18% growth since 2010 with over 9,000 defence companies based in the UK.

A strong start-up culture around distinct tech clusters, active venture capital, world-leading universities, the lowest corporation tax in the G20, and notable strengths in electronic systems, communications, data management and analytics, cloud services, AI, cyber security, and sensors make the UK a high-value strategic partner on the international manufacturing stage.

UK and Indian businesses want to transfer knowledge, collaborate, and partner, particularly in realising industry 4.0. However, this is not without barriers.

This is why, in our report, we make nine high-impact recommendations, these include:

  1. Strengthening international partnerships in defence manufacturing
  2. Expanding FDI in defence
  3. Fast, efficient, and transparent customs approvals
  4. Globally competitive taxation
  5. Consistent implementation and enforcement of policy
  6. Strengthening IP enforcement
  7. Strategic support for digital manufacturing
  8. Re-classifying India as “low-risk” to boost labour mobility
  9. Increased Government-to-Government interactions

If implemented, these recommendations would transform FDI into India and further improve the UK-India partnership, not least in defence and aerospace.

India’s defence modernisation programme presents an opportunity to not simply boost trade, but actively build a closer strategic relationship.

This is why UKIBC has established a defence sector advocacy group which has recently met with senior Officials from India’s Ministry of Defence and held its second Sector Advocacy Group in Delhi earlier this week.

UKIBC CEO, Richard Heald, said:

“India’s ambition to become a 21st century manufacturing superpower is absolutely right. However, in order to achieve this, international partners and collaboration will be absolutely crucial. As such, we very much look forward to working closely with the Government of India, and strategically important State-level Governments, to explore how the recommendations of industry made in our report can be implemented to the greatest effect”

In drafting this report, UKIBC consulted closely with the largest manufacturing and engineering firms across the UK-India corridor through a series of dedicated events, surveys, and one-to-one interactions. If you would like to find out more about work in the advanced manufacturing sector and how to become involved, please get in touch with our Sector Manager, Prasenjit Dhar at prasenjit.dhar@ukibc.com


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