UK Chancellor of the Exchequer Jeremy Hunt and Indian Finance Minister Nirmala Sitharaman concluded the 12th India-UK Economic and Financial Dialogue (EFD) in New Delhi this week with big steps forward in the field of capital markets cooperation, pensions, insurance and infrastructure.
Close on the heels of the India-led G20 Summit attended by UK Prime Minister Rishi Sunak, the EFD discussions opened the door for Indian firms to explore listing directly at the London Stock Exchange following recent changes to regulation in India to allow domestic companies to access global markets.
Jeremy Hunt said: “I’m very proud of the progress we’ve made through the UK-India EFD this time. It’s a big step forward to hear India confirming that they’ll explore the London Stock Exchange as an international destination for the direct listing of Indian companies.
“I see India as Asia’s Silicon Valley and the UK as Europe’s Silicon Valley, so there’s a lot we can work on together.”
In addition, a new UK-India Pensions and Insurance Partnership will support the growth of the sector in both countries. The partnership will focus on knowledge sharing, growing bilateral investment and diversifying risk, including through pension fund trade missions to encourage increased bilateral investment.
Official statistics show that trade between the UK and India was worth £36.6 billion in the last financial year, up over 34 per cent year on year, with an £82 million increase in UK-India financial services trade over the last year. EFDs are seen as a regular way of deepening ties to grow the economies of both countries. This week’s dialogue marked the first face to face meeting of its kind between the finance ministers of both countries since 2017, with the most recent taking place virtually in 2021.
The launch of a UK-India Infrastructure Financing Bridge was also announced following the EFD. Co-led by Indian public policy think tank NITI Aayog and the City of London Corporation, the initiative will focus on sharing expertise in structuring and financing major infrastructure projects.
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Chris Hayward, Policy Chairman at City of London Corporation said: “This new infrastructure initiative is aimed at leveraging the City of London’s expertise in structuring and phasing major projects to meet India’s infrastructure needs – smoothing the path for long-term sustainable investment into India.
“The EFD marks the strength of the partnership between UK and India and lays an excellent foundation for future ventures between our financial and professional services sectors.”
Other key announcements as part of the EFD include:
· The signing of the UK guarantee to the World Bank to unlock an additional $1 billion of green financing in India. This will promote clean energy investment and support green growth targets, accelerating India’s climate transition and ability to meet COP26 commitments. The UK said it hoped that it will encourage other international partners to support India and shape the world’s climate transition.
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· Agreement to explore new investment opportunities in areas of shared priority, including leveraging institutional capital to invest in climate adaptation and green businesses in India. This builds on the success of the Green Growth Equity Fund, India’s first dedicated climate change fund backed by British International Investment.
