New Delhi: George Osborne, the UK’s chancellor of the exchequer, is visiting India as part of the official delegation accompanying Prime Minister David Cameron. Osborne spoke about the significance of the visit in an interview. Edited excerpts.
This is perhaps the largest UK delegation to visit India in 60 years. What is the economic context?
The idea came in 2006 (when Osborne was in the Opposition as shadow chancellor). I am a believer in relationships. We can sometimes neglect a good relationship because it requires no effort. We want to turn a good relationship into a great one. We want more investment on both sides.
You have said India now has a strategic stake in multilateralism. We are given to understand G-20 is the forum where really far-reaching decisions are made. How would you place the Indo-UK relationship in the context of G-20?
G-20 is a prominent world body in deciding economic policy. We had decided in Canada (in July) that G-7 should no longer take the lead. I met finance minister Pranab Mukherjee at the G-20 finance ministers’ meeting. I respect his wisdom. India’s voice should be heard as a large economy in the world. We will support India at International Monetary Fund (in relation to restructuring the body).
Realistically speaking, do you see UK-India trade relations just chugging along with one or two big spikes such as the trainer jet deal?
What this trip is about is not about a one-off visit or big-bang trade deals. It is about renewing and strengthening a relationship. And we are going to leave India having established a joint CEOs forum between top Indian chief executives and top British chief executives to advise both prime ministers. We have left behind us collaboration between British universities and Indian higher education institutions. We have got heads of 14 top British universities here. It’s not just business, there is a cultural memorandum of understanding. It is a whole series of relationships, which is not a single big bang. It is a beginning of a series of strong enhanced...relationships.
You mentioned Ratan Tata earlier. Has the UK’s new energy policy put the Tatas at a competitive disadvantage in relation to manufacturing?
I don’t believe that will be the case. We have been very dependent on oil and gas. We have been very fortunate, blessed with domestic gas. They won’t last very long. We need to invest in the next generation of energy generation that does not contribute to climate change. And I think there is an opportunity for Britain to be a world leader in renewable energy. And also civil nuclear power. Again, there is an opportunity for a relationship between the Indian nuclear industry and the British nuclear industry.
Rolls-Royce has signed an agreement here to help progress that. On the energy front what will come out of the British government’s policy is sustainable energy in both senses of the word. Sustainable in terms of the environmentally sustainable, but also sustainable in terms of energy security.
You met the governor of the Reserve Bank of India, D. Subbarao. Foreign banks, Standard Chartered Bank Plc, for instance, have been asking for easing policy restrictions on expansion. Did you discuss the issue?
It was a private meeting, a personal meeting with governor Subbarao and then I brought in the chief executives of Standard Chartered Bank, Barclays Plc, we also had the London Stock Exchange and indeed we also had Anshu Jain from Deutsche Bank AG.
I raised two issues. One, we would like to see the road map that was drawn up in 2005 continued with. We well understand the banking crisis has put a delay in place.
Lots of countries, including the UK, are thinking about restructuring the banking industry. It would be of mutual benefit to Britain and India if we are able to offer more banking services to the Indian population, particularly in the rural areas.
We would also like to see the very welcome commitment to increase FDI (foreign direct investment) in the insurance industry.
When Gordon Brown last visited India, he exchanged views on Vodafone’s tax problems in India. Is that going to be on the agenda this time?
In the end, Vodafone has to resolve the issue with Indian tax authorities, and I know it is before the courts. The great thing about India, like Britain, is that it has an impartial judiciary and independent legal system. I think that’s a great strength for India. I am sure Vodafone will get a fair hearing.