British finance minister George Osborne on Wednesday pressed India to speed up the opening of its financial services market and said he wanted to see completion of a free-trade agreement with Europe by early 2011.
In a speech in Mumbai, Osborne said that greater Anglo-Indian cooperation would bring benefits for both sides and announced that India’s Exim Bank will be granted a licence to operate in Britain and the State Bank of India would base its European headquarters in London.
Ten weeks since taking office, Osborne is in Mumbai as part of Britain’s biggest trade delegation in modern times.
He will join Prime Minister David Cameron and a host of other ministers and businessmen in Delhi later as Britain’s new coalition government pulls out the stops to boost its relationship with the former colony and Asia’s third largest economy.
“The UK has a vital stake in India’s rise to global power and prosperity and we are here to listen and to learn, to find out how our strong relationship can grow stronger still,” he said.
The focus would be on boosting trade links, better cooperation between financial services industries and a better recognition of common goals in the international policy arena.
“Standard Chartered, HSBC and RBS are three of the top four foreign retail banks in India,” he said. “Offer them licences in the medium-sized towns and smaller cities and they will jump at the opportunity to be part of the huge effort to bring modern banking services to millions more Indians.”
He also called on the Indian government to make good on its commitment to raise the foreign direct investment cap on insurance companies to 49 per cent from the current 26 per cent.
Britain’s second largest insurer Aviva said in an interview it would raise its stake in a joint venture with Dabur as soon as the limits were changed.
Osborne said more also needed to be done to complete the European Union-India free-trade agreement.
“Negotiations are now entering their fourth year. We need to provide the leadership to complete the free trade agreement by early next year,” he said.
