One in six people in the world are Indian, and 1.5 million live in Britian. So its perhaps no surprize that when Narendra Modi came to visit David Cameron to talk about, among other things, GBP/INR he got a big reception.
The visit from the Chinese Premier weeks before ended with Dave and Xi down the pub for a pint and fish and chips. Sadly it doesn’t appear that Dave and Magic Modi popped out for a curry but they did exchange £9bn in trade deals.
The meeting described the two as being like bride and groom - but I’m not sure who’s the bride and who’s the groom. On the face of it – you’d think that Dave is the Groom.
- The UK is 3rd largest foreign European investor in India.
- 800+ Indian companies operate in UK more than any other Eurozone country
- 250 foreign banks live in London and provide 4 of out 10 global transactions.
But Modi has quite the Dowry
- IMF declared India as fastest growing economy at 7.3% growth
- India has moved up 12 places in the economic rank of states
- Reforms to make India most attractive investment destination according to Ernst young
UK FinTech services have had £1 Billion of investor money poured into them lately, and whilst large parts of that technology is written and built inside India, a lot of its future use also lies there. Millions of unbanked, English speaking, FinTech customers all with a smartphone are an attractive prospect for both bride and groom.
Modi spoke of unleashing Digital India in partnership with London being the tech capital of Europe. All the while working towards liberalisation of financial markets.
There in lies the difficulty. India has a closed financial marketplace. The frog remains within the well. Technology may break down the barriers but Indian Finance ministers hold great power state by state. The Rupee is an NDF currency and whilst many UK banks run a GBP/INR book it doesn’t get the attention that the RMB does. Nor did Modi get to stay at Buckingham Palace unlike his Chinese counterparts!
The groom may have arrived on a horse and is heading in the right direction. But we’re all keeping our fingers crossed that it doesn’t become a white elephant.