Deals worth at least £370 million (around Rs.3,800 crore) were signed between India and the UK on Monday, the first day of a visit by George Osborne, the British chancellor of the exchequer, and William Hague, the country’s foreign secretary.
The Indian Air Force and companies such as the Mahindra Group and Cipla Ltd were among those that signed business agreements with UK-based corporations. Osborne told a press conference in Mumbai that India’s defence ministry has signed a £250 million contact with missile maker MBDA of the UK for the supply of advanced short range air-to-air missiles (ASRAAM) to the Indian Air Force’s fleet of Jaguar aircraft. Osborne and Hague are on a two-day visit for high-level meetings with members of the new government led by Narendra Modi. The visit is aimed at opening up investment opportunities for UK firms in India’s defence and infrastructure sector, as well as attracting Indian investment to the UK.
The duo met Raghuram Rajan, governor of the Reserve Bank of India, on Monday and will meet Prime Minister Modi and finance minister Arun Jaitely in New Delhi on Tuesday. Osborne also announced that Indian pharmaceutical company Cipla will be investing £100 million in its UK subsidiary to manufacture and supply a range of medicines in the area of respiratory diseases, cancer and HIV/AIDS. “This kind of high-tech, research-driven investment is the future for both our economies,” according to the text of a speech by Osborne posted on the website of the UK government. Cipla informed BSE of the investment on Monday. Separately, the Mahindra Group signed up to invest £20 million in the UK to develop electric car technology. “This great Indian business is now going to invest £20 million in developing the latest electrical car technology in the UK.
And Mahindra’s first electric car is expected to go on sale in Britain next year. Britain wants to be at the centre of the technological revolution in electric cars,” Osborne said. The Mahindra Group did not offer any comments for the story. Referring to the missile deal, Osborne said it will create hundreds of jobs in the UK. The missile manufacturer declined to comment on the announcement, saying there is no official statement from the company at this point of time. In an email statement, Shireen D. Mistry, director, Western India, communications and public affairs, at the British deputy high commission in Mumbai, said the contract will create roughly 240 jobs in the UK. “The IAF (Indian Air Force) will call the missile the ‘New Generation Close Combat Missile’ (NGCCM). This is an excellent deal for both India and the UK. It underlines the UK government’s support for India’s defence modernization agenda by accessing the latest, state-of-the-art defence capabilities currently available in the UK,” Mistry said. Details of a rupee-denominated export finance scheme will be announced during the visit to Delhi on Tuesday, said Osborne.