Examination of Witnesses (Questions 229-239)
INDO BRITISH
PARTNERSHIP NETWORK
28 FEBRUARY 2006
Q229 Chairman: Gentlemen, welcome to
this evidence session on the Committee's inquiry into Trade and
Investment Opportunities with India. Can I begin by asking you
to identify yourselves, please, for the record?
Mr Bilimoria: I am Karan Bilimoria,
founder and Chief Executive of Cobra Beer and the UK Chairman
of the Indo British Partnership and the founding Chairman of the
Indo British Partnership Network.
Dr Vyakarnam: I am Shai (short
for Shailendra) Vyakarnam. I am Director at the Centre for Entrepreneurial
Learning at the Judge Business School, Cambridge University, and
I am a director of a few small businesses and various other affiliations
and I am on the Board of the Indo British Partnership Network.
Q230 Chairman: Thank you. We are
now becoming if not quite experts at least quite familiar with
the structures in the UK to support trade and investment with
an interest in India, but I just worry that sometimes to the outsider
it could look like quite a bewildering plethora of initials and
initiatives. I wonder if you can just explain to us exactly how
the IBPN fits into the overall picture and what value it adds?
Mr Bilimoria: India started its
liberalisation process in 1991 and Britain and India were pretty
quick off the mark to take this occasion as an opportunity to
take the relationship between the two countries on a trade and
business level to a high level, and John Major and Narasimha Rao,
the Prime Ministers at the time, in 1993 formed the Indo British
Partnership Initiative, which later became the Indo British Partnership.
It was a way of engaging with the private sector in both countries
to help increase trade in business and investment both ways between
the two countries. At the UK end, the Indo British Partnership
was always supported by the British Government, and a private
sector chief executive has been appointed as the Chairman every
few years. When it was launched, it started off in a very big
way. Concorde was chartered to take a delegation across, Britannia
was sailed across, a lot of investment and effort was put into
the Initiative. Later on, the Initiative did lose its momentum
over the years, and we celebrated the tenth anniversary of the
Indo British Partnership Initiative in India in 2003. It was decided
then that the Initiative had a lot of potential and needed to
be revived, so I was appointed as the UK Chairman in July 2003
with a specific remit to revive this Initiative because it had
lost momentum. It took me a long time actually to revive it, to
initiate and start the Indo British Partnership Network as a way
of implementing the Initiative, to set up a Board, to set up a
membership organisation, supported by UK Trade and Investment.
Q231 Chairman: What value does it
add? UKTI does its work, the RDAs do their work, there is JETCO
now, which has been established relatively recently, there is
the Asia Task Force, which seeks to draw the attention of British
business to wider opportunities in Asia; with all of this work
going on, are you convinced that the Network actually adds value
to the sum total of the relationship?
Mr Bilimoria: At the time I was
appointed, we found that there was a policy existing where UKTI
were focusing on sectors, helping business through sectors, dividing
business up into sectors, and were not focusing on promoting markets
or countries, such as India. One of my challenges was to persuade
government that, yes, you look at things from a sector point of
view, but you have got to look at countries, like India, as a
market, it has got to be markets and sectors, not markets or sectors.
To the extent that there was no funding available, the head of
the South Asia Unit of UKTI used to have 36 individuals in that
Unit just five years ago; today there are six people in that Unit.
Of course, 80% of the work done in the South Asia Unit at UKTI
is India-related, and in those five years India has grown, on
average, between 6-8% year on year and UKTI have reduced the resources
from 36 people to six people. My great challenge was to say we
need this Initiative because British businesses throughout the
country, particularly the SMEs, are not aware of the opportunity
of doing business in India and investing in India, and doing business
with India, and we need to make them aware of the opportunity,
we also need to help them to do business, to guide them, point
them in the right direction and help them capitalise on the whole
area. It did not exist, and this was a great way of engaging with
the private sector and for the private sector and the Government
to get together, which was not happening.
Q232 Chairman: We want them to succeed
and one of the reasons the Committee is having this inquiry is
our concern that Britain is not being sufficiently entrepreneurial
in its relationship with India, and probably also with China and
Brazil and Russia and other emerging economies, so we want them
to succeed. I am not clear actually what it is you do, because
your very good document Doing Business in India, which
you have kindly passed to the Committee, seems to say basically
"Go and talk to UKTI and they will help you". Are you
a PR operation or do you provide actual services? We value the
PR operation, but what is it?
Mr Bilimoria: I presume that you
have received the submission, apart from the guide to doing business,
of the Indo British Partnership, its background and actually what
are our objectives. The objectives are very simple: to help increase
bilateral trade, business and investment between Britain and India,
both ways. We have, in a short time, with actually relatively
very small amounts of funding, we are backed by UKTI, for which
we are very grateful—
Q233 Chairman: Initially you were
backed by UKTI?
Mr Bilimoria: The plan is that
for the first three years we are backed by UKTI and after that
the plan is to be self-funding. The sorts of sums of money we
are talking about are not very large for what we are doing.
Q234 Chairman: What is the sum we
are talking about?
Mr Bilimoria: The first year's
funding was £70,000; on top of that, we have raised sponsorship
to the value of about £10,000. Relatively speaking, really
it is a very small sum of money, when we are talking about dealing
with the second-largest country, in population terms, in the world,
and one of the fastest-growing economies in the world. The figures
are quite stark. The trade in goods and services between Britain
and India, both ways, amounts to £6.4 billion, that is 1%
of Britain's overall trade of just over £600 billion, so
we are scratching the surface. If you look at the submission,
the objectives are very clear, but, in terms of what we have achieved,
the company was incorporated in April 2005 so it took me over
one and a half years actually to convince government that we needed
this initiative to be in place, that we needed a membership organisation
that people could join, that we needed an initiative that was
going to help promote business between the two countries. We were
incorporated in April 2005 and, since that time, in the submission
you will see the list of various activities that we have engaged
in. As a Board, we meet bi-monthly, we have two-hour Board meetings,
extremely well attended, UKTI sit at the table, quite often we
have the Foreign and Commonwealth Office present as well, if there
are members of the British High Commission team in India in the
country they attend the meetings as well, and it is the private
sector, with government backing, addressing the issues of doing
business and promoting doing business with India.
Q235 Chairman: I want to get on to
some of the questions you hinted at in that very helpful answer
just then. For example, the list of events you are planning says:
"A programme of proposed forthcoming events includes regional
business seminars in Birmingham, Manchester and Glasgow/Edinburgh
. . ." That is very useful to draw to the attention of the
smaller and medium-sized businesses. How will you contact these
businesses, will the RDAs do that for you, will you hire UKTI,
the Chambers of Commerce; what mechanism will you use?
Mr Bilimoria: The way that these
regional events operate is that, for example, we had one in Derby
which was organised by the local region.
Q236 Chairman: The Regional Development
Agency?
Mr Bilimoria: Yes, the Regional
Development Agency, the local BusinessLinks gets involved, and
they invite local businesses to come and attend, and there is
growing interest; these events sometimes are oversubscribed by
50%.
Q237 Chairman: How many did you have
at Derby?
Mr Bilimoria: In Derby, we had
almost 200 people. In Warrington, Cheshire, we had an event where
they had budgeted for 60 people and the room could take a maximum
of 80 people, but in the end they had about 50 or 60 more on top
of that who wanted to come, so there is a growing interest.
Q238 Chairman: Were they businesses
which wanted to come, or were they public sector employers who
were networking and finding out, or were they actual companies?
Mr Bilimoria: There were lots
of local businesses there and there is genuine interest. What
we are doing is providing the private sector input, but it is
the government-backed initiatives, like BusinessLinks, UKTI with
their trade advisers around the country, who are there to organise
these events, we go there, speak at the events and give the private
sector perspective and advice. The good thing, from my personal
point of view, is that when I talk I am talking not only as a
Chairman of the Indo British Partnership but as somebody who is
walking the talk and doing business with India myself, through
Cobra Beer.
Q239 Chairman: I understand that,
and your name is well known and probably you are the only household
name on the Board of the company, some household name companies
are there. Do you feel you are overshadowed slightly by the Asia
Task Force, which has rather bigger companies involved with that?
Mr Bilimoria: When we decided
on selecting the Board members for the Indo British Partnership
Network, we were very clear that we wanted a variety of sectors,
which I think you can see from the Board members, we have representation
from the London Stock Exchange, from Virgin Atlantic, from lawyers,
consultants, the brewing industry, so a variety of different sectors.
From the companies, I wanted senior-level individuals who had
the knowledge and expertise of doing business with India, as opposed
to having a well-known chief executive, I would much rather and
we decided deliberately to have people who had that in-depth knowledge,
who were genuinely passionate in their knowledge about doing business
with India. For example, the Board member from KPMG actually set
up KPMG in India from scratch and is now a partner over here in
the UK. The Board member from Accenture, which is now one of the
largest consultants employing thousands of people in India, set
up Accenture in India and is now a senior member of Accenture
here in the UK. It is that sort of expertise of people who have
been there, who have done it, who have that in-depth knowledge
and we have got a superb Board. Our Board meetings are absolutely
packed. We come out of them feeling really we have achieved a
lot. They are constructive; it is not a talking shop.
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