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Indian investment in UK up despite Brexit uncertainty

New India-specific figures released on Thursday by a London-based consultancy complements recent UK government statistics that show Indian investment continuing to rise despite wider uncertainty in business circles due to Brexit.

world Updated: Apr 25, 2019 17:49 IST
Prasun Sonwalkar
Prasun Sonwalkar
Hindustan Times, London
British prime minister Theresa May,Brexit,United Kingdom
British prime minister Theresa May(REUTERS FILE PHOTO)

New India-specific figures released on Thursday by a London-based consultancy complements recent UK government statistics that show Indian investment continuing to rise despite wider uncertainty in business circles due to Brexit.

The figures by Grant Thornton in its ‘India Meets Britain Tracker’ says that analysis of data from almost 850 UK-incorporated limited companies owned or controlled by Indian interests found a significant increase in the contribution of Indian companies to the UK economy over the last year.

There are now a record 842 Indian companies operating in the UK, up from around 800 in the previous year, with combined revenues of almost £48 billion (£46.4 billion in the 2018 report).

Indian companies paid a combined total of over £684 million in corporation tax, which is almost double the amount recorded in last year’s report (£360 million), and employed 104,783 people (104,932 in 2018 report), the tracker says.

The 2019 edition, published in association with the Confederation of Indian Industry, provides a tracker of the fastest growing companies, as measured by those with turnover of more than £5 million, year-on-year revenue growth of at least 10% and a minimum two-year track-record in the UK.

Anuj Chande, head of South Asia Group at Grant Thornton, said: “Given the continuing uncertainty driven by the UK’s exit from the EU, it is encouraging to see that Indian investors continue to invest confidently in the UK and in fact, there are now more Indian businesses active in the UK than ever before”.

“The attraction for Indian investors and families includes factors such as top universities and the opportunity to do business in English. The fall in the value of sterling has also had a role to play, making UK assets increasingly attractive to overseas investors. Low rates of corporation tax and the ease of doing business in the UK also remain significant draws.”

This year’s tracker includes 62 companies that recorded an average growth rate of 37%. The total combined revenue of these companies reached over £12 billion last year.

Three companies reported growth of more than 100%: the fastest growing is TMT Metal Holdings Limited, with a growth rate of 649%, followed by Route Mobile (UK) Limited, which reported growth of 189%, and BB (UK) Ltd, which achieved turnover growth of almost 129%.

Technology and telecoms companies continue to dominate, accounting for 35% of the fastest-growing companies. Engineering and manufacturing companies are the next in line, accounting for 16% of the 2019 tracker; followed by pharmaceutical and chemicals companies, which account for 15%, continuing historically strong representation.

London continues to be the preferred location for more than half (53%) of the 62 fastest growing Indian companies.

Chande added: “As India seeks to capitalise on its growing economic status and the UK looks to reinvigorate its role as a global trading nation, the future relationship between the two countries has the potential to become more substantial than ever over the next few years.”

Lakshmi Kaul, head of CII in UK, said: “The most successful Indian businesses look at their UK investments from a long-term perspective and not for short-term gains. As India’s economy continues to grow, Indian companies will increasingly have greater choice over where to invest and the UK must ensure that, beyond Brexit, it remains a leading investment destination”.

“But the foundations for a mutually beneficial relationship between India and the UK are clearly already in place. The two countries have much to offer each other and, by committing to re-forge their historic relationship, they can move forward together towards a prosperous future.”

First Published: Apr 25, 2019 17:49 IST