Lalit Modi issue is not a govt matter; it's a legal matter: Oliver Letwin

Interview with British minister-in-charge of Cabinet Office

Oliver Letwin, British minister-in-charge of Cabinet Office, said controversy around former Indian Premier League chief Lalit Modi has not impacted India-UK ties. Letwin, fondly regarded as British Prime Minister David Cameron’s ‘eyes and nose’, told Nayanima Basu that during Narendra Modi’s visit there in November, both sides would like to take the relationship to a new level. Edited excerpts: 

Your visit interestingly comes at a time when the Lalit Modi controversy is raging, with our External Affairs Minister Sushma Swaraj at the Centre. Do you feel it has impacted the bilateral ties?

The relationship between the governments is not an issue here. This isn’t a governmental matter. It is a legal matter and ordinary legal processes will apply and I think both India and the UK have strong tradition of independent justice and it is not at all issue between the UK and the Indian government.

What are your expectations from Prime Minister Narendra Modi’s visit to Britain that is likely to take place in November?

We want all that to be fulfilled, which, according to your PM, is an “unbeatable combination”. We are seeing this as cooperation, getting together to work together on a whole series of investment propositions and to take further what is of mutual advantage. We have formal economic dialogue established and we are, of course, very much looking forward to Prime Minister Narendra Modi visiting Britain in November. One of the purposes of my visit was to carry forward some of the discussions we had been having for a long time now and part of it also is to deliver some things jointly when the PM visits us. Your PM’s visits always act a huge catalyst for things to happen, which might otherwise take a long time.

A special investigative team has recommended tightening of norms for participatory notes. We also saw the markets crashing down. How are the British institutional investors viewing it?

Every market has its ups and downs. Your economy is very impressive now and I think the whole world is impressed to the extent in which your government is making business easier. The moves that have been taken to deal with corruption and social security are very impressive. People are optimistic about India.

Are retro investments still a concern with your investors. What solution do you see to the Vodafone tax dispute?

The sense that we got from our colleagues in the UK firms is that a very sensible solution has been found in the form of arbitration. I met the Vodafone executives in Mumbai and they said it was a very good move by your finance minister to abide by the arbitration. We are grateful that the government is following it. This is a very proper process.

Did you ask finance minister to rollback the policy?

No not at all. It is for your finance minister to take those decisions. We believe a perfectly sensible route has been found.

Yet another British conglomerate Tesco is also stuck with its investment proposal here as the government has decided not to allow foreign investments in multibrand retail.

I will not be speaking on this specifically but obviously we are interested to see greatest possible openness. We entirely recognize the government is working on a timetable. We are also in a democracy and we understand in a democracy these things are not easy.

Recently, the government introduced composite caps for foreign direct investments (FDI) on certain sectors to bring clarity.

It is not just one step but all steps that the government has been doing which follows after all a long pattern through several different Indian governments that made India more and more attractive. And that is why UK is the single biggest investor in India and indeed India has more investments in the UK that in the whole of EU put together. There seems to be a pretty good trade and investment relationship.

I understand Britain is keenly looking at investing in the country's infrastructure sector?

We are very keen that London should play a part in raising external rupee financing for Indian infrastructure. This could be advantageous from Indian point of view and also for us because India is going to be a great economic power in the next 20, 30 or 40 years. So we need the city of London to be involved in raising finance for India. We have made very considerable progress in the last few years. We have raised finances for Renminbi in China and we now have a series of 'masala' bonds which can be issued in the London market.