According to numbers shared by the British High Commission in New Delhi, as of 2018, over 800 Indian companies were operating in the UK, employing over 100,000 people in the region. India is the UK's fourth-largest source of FDI projects and was the third-largest FDI job creator in 2017-18.
Technology forms a big part of this trade relationship, with 31 percent of Indian investments in the UK being in tech, with roughly the same share in jobs creation. The UK, meanwhile, exported £344 million (approximately Rs. 3,015 crore as of date) of digital services to India in 2016, and recent events have brought the two countries even closer.
“The UK and India share a unique relationship that has strengthened over the years through living bridge, investment, and cultural links,” Amo Kalar, Deputy Director, Trade and Innovation, British High Commission, tells Gadgets 360. “There are now a record 842 Indian companies operating in the UK, employing over 104,932 people in 2018. This is testament to the UK's skilled and expert workforce and this continued investment will help to create jobs, contribute tax and play an important role in deepening and extending the longstanding ties between India and the UK.”
One of the organisations that has been playing a big role in enhancing the scope of cooperation between the two countries is a non-profit called techUK. The organisation represents the interests of the tech industry in the UK, similar to what NASSCOM does in India. During Prime Minister Narendra Modi's visit to the UK in April last year, techUK and NASSCOM signed a formal agreement to increase the scope of their cooperation.
At the sidelines of the London Tech Week earlier this month, Gadgets 360 got a chance to have a chat with Simon Spier, Head of International Trade at techUK on the relationship with NASSCOM and how the two organisations are working together to facilitate tech companies in both countries. Here are excerpts from the conversation, edited slightly for clarity.
In your role, are you more focused on UK companies looking outwards, or companies from India as well as other countries looking at the UK as a destination?
It's both. At techUK our role is, we're not-for-profit, member-funded trade association. We have 900 members ranging from startups through to large multinationals, including the likes of BT and Vodafone, but also we have a number of non-UK, globally headquartered tech companies as members — Google, Microsoft, Facebook — and so on. From India, [we have] TCS, Infosys, HCL, Wipro, Genpact, and others are all members.
And as an organisation we are there to help shape policy — so push for tech-friendly legislation — but also work on market engagement so [as] to support companies' growth, both in the UK and internationally. Our sister organisation is NASSCOM, so that's probably the easiest point of comparison, and we work very closely [with] them.
My role as head of international trade is to work with our members to help them understand and realise opportunities outside of the UK, to work internationally to encourage and support investment into the UK. And to work on the policy to make those two things a bit easier, reduce some of the friction. And we have a number of India specific initiatives [as well].
We have created something called the UK-India Tech Forum and we've also signed the UK-India Tech Alliance. So the UK-India Tech Alliance is a partnership with NASSCOM — which actually forms a part of the official UK-India Tech Partnership signed by the Prime Ministers [of UK and India in April last year] — and the idea behind that is to support policy collaboration supporting bilateral trade and to look at some of the challenges — whether that's sort of skills and talent gap — or whatever issues may be in terms of helping the bilateral trade picture.
We have also formed within techUK, the UK-India Tech Forum. This is a specific group that looks at how can we can, again, improve the bilateral trade picture, brings in UK SMEs and Indian SMEs, UK corporates, Indian corporates as well as other multinationals that play in both the UK and in India. We also bring into that other bodies such as the Federation of Indian industry (FII), Federation of Indian Chambers of Commerce & Industry (FICCI), the UK India Business Council, both the British High Commission in India, and the Indian High Commission in the UK, and probably some others that I'm forgetting.
And the the idea behind that is to, again, look at specifically what are some of the opportunities and challenges as it relates — if I'm a UK company trying to do more in India, whether I'm an SME who's just getting started in my international expansion or whether I'm a large multinational, what are the challenges I'm facing? And those same questions in reverse.
And sometimes those challenges are big macro-level issues — movement of data, movement of people, looking at what our future trading agreement will look like between the UK and India, and sometimes they are a lot smaller sets. [For example] a UK company struggling to understand the difference between state and national level regulations in India, how do they go about navigating them, what's the best place to set up, those sort of things.
Or [an] Indian company coming to the UK, struggling, they may have an entrepreneurial visa, but they're trying to get their spouse to come with them, or they're struggling to open a bank account — these sort of things where there's some relatively easy fixes to that. And sometimes it's just information asymmetry. Or sometimes it's just a little bit of tweaking within the system.
Because we are taking a holistic approach and we're bringing everyone into these conversations, we're then looking at how we can deal with some of these smaller issues, which actually matter on the ground. And then how we can use connection for both governments to look at the macro issues in terms of what's the migration picture and and those sort of challenges.
Are there any particular domains which are in greater focus, as far as India-UK tech collaboration is concerned?
Yeah, so the the areas where I think there's perhaps the most focus and the most potential — and this isn't to say there isn't potential in other areas — but particularly around health technology, around identity and cyber[security], around FinTech, and around smart cities.
I think there's a natural opportunity for both UK companies going out to India — especially around FinTech and, health tech, as well as smart cities. I think, for Indian companies coming into the UK — India is incredibly good at producing tech ready graduates in a way that the UK just isn't able to do it at the scale that's necessary.
And so just to expand on that, at any given time there is always a significant shortfall in the amount of employees the UK tech sector needs and what is able to be supplied. Estimates reckon that by next year there'll be a million person shortfall. So being able to bring in Indian tech talent is a part of the solution to that.
How has the partnership with NASSCOM been and what can one expect in the next couple of years?
So that partnership is set up and the idea behind it is that the we will bring in high-level UK companies, high-level Indian companies, they'll meet three to four times a year and they will look at the changing shape of the UK-India trade as that grows stronger and stronger, identifying what are some of the issues.
So high up on the list of issues has been skills, in terms of UK at any given time has this million person shortfall in terms of what the tech industry needs (or will do by next year), how can we work to help fill that gap, and part of the issue in terms of just availability of labour. So in the short term, making it easier for exceptional talent to come here to the UK is is one solution, but it's not the only solution.
We also need to encourage more people [in the UK] to be taking STEM subjects at an early age, improving female participation in the workforce. So we've been working with some of the big Indian tech companies abut how they engage with academia in [India] and how they take and the learnings they have in terms of encouraging STEM participation at a significant level. How can we adopt similar solutions in the UK.
So that's one example, around skills, the other is about where are opportunities specifically for UK companies going into India. So UK, obviously, is a global leader in FinTech. In terms of some of the agenda items that have been taken in India — demonetisation, AADHAAR — there are significant opportunities for FinTech solutions to be introduced into India at scale in a way that you can't do in the UK. So there's a really nice opportunity there.
That's one example, I mean, you obviously have huge opportunities in terms of health tech [and] opportunities in terms of smart cities. And I think that the key thing is though the UK is phenomenal when it comes to innovation — we have four of the top 10 leading universities, we have a well-backed VC community — the UK market's limited to 70 million. Yes, we have the EU market, which is 500 million, [but] the relationship with the EU is obviously changing, we still need to see how that settles.
But you have an opportunity of 1.3 billion people in India, you have a natural relationship. English is obviously widely spoken in India, culturally they're fairly similar, we have a significant number of Indian people living in the UK, the time difference is negligible — so there's a lot of opportunities in India that when you look at other markets of a similar size perhaps there's different challenges. So it's a really interesting opportunity in terms of the innovation coming out of the UK and the ability to match up with the scale and the opportunity in India.
So that's what the alliance is looking at, broadly.
Is the relationship that you have with NASSCOM is fairly unique or do you have similar relationship with equivalent bodies in other countries as well?
It's pretty unique. We do have relationships with a large number of our sister organisations across the world, but those tend to be more sort of policy supporting relationships. This — taking it to a trade facilitation level and the kind of the formalised agreement that we have with NASSCOM — is the only one that we have.
We will be looking obviously to expand those relationships but I think there is an equal understanding in the UK and India in terms of the opportunity for UK-India relations to grow, especially given the Brexit context.
How does the partnership with NASSCOM work at the ground level — how would a UK startup go about getting help with the India market, for example?
So we support them, we work with NASSCOM, we work with a number of other bodies. Some of the feedback that we've been getting — in both directions — is that there is a lot of organisations there that can help — whether that's us, whether that's NASSCOM, whether that's the British Department for International Trade, the Indian equivalent, UK RBC, and various other partners. That's in the in the sort of public sector — [then there's] obviously lawyers and accountants and stuff.
There's so much information out there, and actually, it's not necessarily a challenge to find [a] supporter, the challenge is to sort of navigate all that information and seeing kind of [where] the best support is. We're actually trying to help map that and make it as easy as possible for UK companies going to India and vice versa, to actually navigate that particular journey.
And it will be a case of — depending on what the company is looking for, what stage they're at, where they're looking to go — the person who can supply the best solution, or the best answers isn't always going to be the same. And we will bring in different bodies to support.
So, for example, if [an] Indian company is coming into the UK, the Department for International Trade is very helpful as the first point of call, but also, depending on where they're looking to go in the UK, there are other bodies that [can] help them.
So [if] they're looking at London, [there's] London & Partners, looking at Manchester, [there's] Midas, [for] Birmingham, there's Midlands Engine — there's all of these different bodies that can support, and sometimes just knowing how to map and navigate that is part of the challenge.
We try and help support companies with that.
A NASSCOM delegation is here for London Tech Week — what's typically on the agenda for these meetings?
I think it's these conversations about what's what's happening in India, what are the core strengths [that] India has, and I think, certainly, that the ability to create talent — tech talent — at scale is really interesting. And I think the solutions that they have in India and how they've done that in [India], the UK is very, very keen to learn, as it should be.
And I think looking at all these big tech companies that have done so well in India, how they can do more in the UK market, but also how they can then use the UK market to go into other countries — whether that's in the EU, whether that's in the wider Commonwealth, whether that's going to the US, there's a lot of opportunities so I think it's how they can grow their business in the UK, and the UK is a fantastic market.
You do have phenomenal talent here, you have great R&D going on, you have access to capital, and you have good cities to live in. London is a thriving place; Manchester, Birmingham, Sheffield, Edinburgh, so on, these are great places to be. So I think the UK is a natural market for a lot of Indian companies to come to, for those reasons and also sort of the culture and the history.
So [these conversation are] about how can they grow their greater presence in the UK with their fantastic solutions.
Disclosure: The correspondent attended London Tech Week at the invitation of the British Government's Department for International Trade.