Memorandum submitted by the British Chambers
of Commerce
"INDIA: ONE YEAR ON—DEVELOPMENTS
SINCE THE
COMMITTEE'S 2006 REPORT"
1. The British Chamber of Commerce acknowledges
that there have been considerable developments since the Committee's
last report on Trade and Investment Opportunities with India.
However we believe that large companies, rather than the SME community
have been the main beneficiaries.
2. India is the UK's 18th largest export
market and its second largest export market in the developing
world after China. In 2005 the UK exported almost £4 billion
of goods and services to India. To those that know India better
it is no longer perceived to be solely the source of low cost
labour but also as a very dynamic ICT and service sector opportunity.
The original off shoring of UK service sector jobs is now in reverse.
3. There is clearly a huge opportunity for
firms of all sizes in terms of developing trade links with India
but we believe more needs to be done to help SMEs in making the
most of these.
4. UK Trade & Investment (UKTI) have
identified 16 broad sectors in which they say "proactive
UK companies can increase their profitability and international
competitiveness"—amongst these are the construction,
creative and media, engineering and ICT sectors. Despite this
however, SME businesses can still find India a challenge when
it comes to realising and exploiting trade opportunities.
5. An indication of the current low penetration
in India by the SME sector can be seen through the enquiries received
by the Export Marketing Research Scheme (EMRS) which the BCC runs
on behalf of UKTI. The scheme encourages UK businesses to conduct
research before entering a new overseas market. Since 1 January
2006, the EMRS has received 1,343 enquiries, of which only 93
(7%) have been from companies with India in their portfolio. Through
the EMRS, BCC has supported 30 individual projects researching
the Indian market with research grants of £103,500 over the
last three years. Enquiries to the scheme have shown a recent
upturn in interest in India which may indicate growing confidence
amongst SMEs to take advantage of the trade opportunities on offer.
6. In order to better support SMEs, BCC
believes that UK Trade & Investment needs to concentrate on
delivering much more focussed activity on India as there are still
too many confusing organisations offering advice and support across
the regions. In our view the understanding many small and medium
sized UK businesses have of the Indian economy has been better
delivered by organisations such as the Chambers of Commerce than
through agencies such as UKTI.
7. The BCC's network of Accredited Chambers
across the UK through their World Trade Forums and Export Clubs
have been making India more visible and potentially accessible
to the smaller business. BCC has several Chambers that offer their
local businesses a better understanding of India. Birmingham Chamber
of Commerce and Industry for instance has developed an India Pakistan
Trade Unit (IPTU), which is the one-stop information shop for
businesses in the West Midlands working and trading with South
Asia. Through the IPTU website businesses can obtain a wide range
of information from comprehensive sector breakdowns to export
and investment opportunities.
8. In addition to initiatives at a local
Chamber level, the BCC is developing close links with the Indo
British Partnership Network (IBPN) and Federation of Indian Chambers
of Commerce & Industry (FICCI) which can only improve dialogue
and relations further. The BCC is looking to become a member of
the IBPN as there is no real voice for the SME on this highly
important and potentially very influential forum. Added to this
the BCC and the IBPN is working with the FICCI to bring potential
opportunities to the SME market. In order to cement relations
further, the BCC a nd FCCI intend to sign a Memorandum of Understanding
later in the year.
May 2007
| 
