Indian companies based in Britain are boosting the growth rates in the country with huge foreign direct investment and creating massive job opportunities.
This finding comes from global consultant Grant Thornton UK.
Some of the interesting findings from the ten page report points out India’s FDI in Britain is at third position after USA and France, with investments going up by 65 per cent.
“The India Tracker shows that the level of investment in the UK by Indian companies remains high. In 2015 saw investments from India rise by 65 PC, making it the third largest source of FDI in the UK”, observed Anuj Chande, head of South Asia Group at Grant Thornton UK.
The report published jointly along with Confederation of Indian Industry pointed out that Indian companies based in Britain registered a combined increase in revenue of £4 billion: from £22 billion in 2014 to £26 billion in 2015.
Though there has not been a large increase in the total number of Indian companies in the UK over the last year, the number of Indian companies growing at more than 10 PC– the key benchmark for inclusion in the tracker – has nearly doubled, from 36 to 62 firms.
In fast growth-sectors
The impressive rates of growth demonstrated by Indian firms reflect the fast-growth sectors in which they operate – notably technology, telecoms (32PC), pharmaceuticals and chemical (19PC) and financial services.
Bharti Airtel tops the list of Indian companies contributing most to Britain’s growth, followed by HCL Technologies, Emcure Pharma, Apollo Tyres and Wockhardt, among others.
Grant Thornton has analysed tax contributions from Indian companies and their employment footprint.
Indian-owned companies pay combined UK corporate tax of almost £650 million up from £500 million last year. The total value of tax contributions would be higher when additional taxes such as payroll and sales tax are taken into account.
Indian firms employ 110,000 persons in the UK
Indian firms employ about 110,000 employees in the UK, with the automotive sector accounting for the highest number of employees at 36 PC.
Of the 62 firms tracked by the study, 30 are SMEs with a turnover of £5 million to £25 million, 27 are mid-sized (turnover £25 million-£250 million) and five are large corporates (turnover of above £250 million).
One of the reasons for increasing Indian investment in Britain Chande lists is how India’s economy grew at an average rate of 7.5 PC in 2015 – faster than the 6.9PC growth achieved by China– making it the fastest-growing large economy in the world.
“Economic stability, encouraged by the Modi government’s pro-business stance, combined with accelerating global ambitions by Indian companies may well see more Indian businesses expand overseas and join the 800+ Indian businesses already established in the UK. The £9 billion in commercial deals announced during Modi’s 2015 UK visit are cause for optimism and 2015 saw no significant changes in Indian government policy likely to dampen enthusiasm for investment in the UK.”, added Chande.
While pointing out how Indian companies invest more in the UK than they do in the rest of the EU combined, the report is cautious on postscript. “What remains to be seen is how attractive the UK will be to these businesses in light of the upcoming EU referendum and possible “Brexit,” the report noted.
On June 23 this year a referendum will be held to decide whether Britain should leave or remain in the European Union while “Brexit” refers to short way of saying Britain and Exit.