Why India Invests in the UK

Image Credit: Indian Express

A few weeks ago China’s President made a visit to the UK to discuss the improvement of trade between the two countries, and now India’s Prime Minister, Mr Modi, has met with David Cameron to discuss bilateral deals worth around £10 billion. Is Mr Cameron making a point that the UK would be better off outside of the EU, where these kinds of deals would be much easier to accomplish without all the EU red tape? 

Mr Cameron believes that these are countries with whom Britain should do far more business, but with previous plans, like doubling trade with India between 2010 and 2015, failing, what makes this trip any different?

India is emerging as the strongest economy out of the Bric nations, Brazil, Russia, India and China,  and is growing at 7% per year. 

Earlier this year the UK Trade and Investment (UKTI) released a report confirming that India is now the third-largest source of foreign direct investment into the UK, which increased to 64% in 2014. The UK India Business Council estimated that the total value of Indian investment in the UK totalled at £1.89 billion by the end of 2014s financial year, and 110,000 people are now employed by Indian companies. 

Talking to the BBC, Alpesh Patel of Praefinium Partners, said “that the ease of doing business in the UK, as well as the English language and familiarity with UK institutions, also makes the UK an attractive proposition for Indian investors.” But this works both ways, by 2015 the UK had invested £14.5 billion in India according to CBI, making the UK the largest foreign investor.  

With Mr Modi’s trip dubbed a success, more investment in the UK can only be a good thing. But should UK based companies now look outside of the EU, to countries like India, if they want to grow their business internationally?

Queen Elizabeth II: One of the UK’s Most Powerful Brands (and Longest Reigning Monarch)

Image from the Royal Household

Queen Elizabeth II may want to keep things low key and “business as usual”, but millions throughout the country are celebrating today as she becomes Britain’s longest reigning monarch. However, Professor Qing Wang from Warwick Business School has found that the Queen is more than a monarch, she is an essential figure for promoting the UK’s products and businesses. 

Professor Wang said: “The Queen and the royal family are the most significant symbols of British heritage and tradition. They inject a sense of continuity and national identity in the globalised and ever-changing world we live in today.

“The Queen and all the history that comes with her, gives British luxury brands an edge and distinctive advantage.”

Global demand for "Made in Britain" labels means UK luxury good firms are set to get a sales boost, as stated in a report from Frontier Economics. By 2019 the value of sales is said to reach around £51.1bn and, according to Wang, Chinese consumers are showing the biggest growing appetite for British luxury goods. 

Professor Wang conducted a survey of Chinese consumers and asked them what they associated with Britain and the “Britishness” they like so much. Her results show that the Queen and the Royal Family were top of the list. 

“Luxury goods are defined as those satisfying hedonic rather than functional needs and our research has found this is an area that Britain enjoys a distinct advantage in,” said Professor Wang.

“The Queen is a significant reason for this, as a very important factor that makes Britain stand out is that it incorporates tradition and innovation seamlessly.

“Put differently, Britain’s advantage lies in the so-called soft power, which is defined as the ability to get what you want through attraction rather than through coercion, and the UK’s royal heritage is a key part of that.

“The extent of its impact is hard to measure and even harder to replicate. As China promotes its own soft power, it has increasingly turned to Britain for inspiration.”

Professor Wang believes that products and services linked to the Queen and the royal family has helped protect them from any slump in the market.

“The continued profit and sale decline of luxury brands are a strong indication that luxury brands are losing their lustre due to over exposure in the global marketplace and outsourcing of production to other countries.

“There is a trickle-down effect of shoppers looking to emulate the luxury lifestyle, but the conspicuous consumption of middle-class consumers is threatening the very essence of luxury being exclusive.

“But the link to the most important British heritage – royalty - reaffirms to consumers the brand’s authenticity and reminds the public of the golden bygone age. Unique and customised product offerings combined with exquisite craftsmanship and the royal association continue to drive sales in emerging markets.”

Specialist brand and business valuation agency, Brand Finance, has put a figure on the monarchy’s value to the UK. The firm found that that the British Monarchy is worth about £57 bn and will make a net contribution to the economy this year of £1.16bn.

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