Unlike India, UK made only minor retrospective amendments: James Bevan

Interview with British High Commissioner to India

The UK wants to attract Indian investment. British High Commissioner to India James Bevan will focus on this aspect and the potential of India-UK bilateral economic partnership, when he participates in the TiEcon conference on Friday in Delhi. He tells Indivjal Dhasmana a review of retrospective amendments to the I-T Act would send positive signals

Your Chancellor of the Exchequer George Osborne came to India and requested our then Finance Minister Pranab Mukherjee to revisit retrospective amendments to the Income-Tax Act. As the Finance Ministry is now revisiting it, do you think it will send the right signals about India as an investment destination?
If the government makes the right decision, it would send very positive signals not just to the UK investors but to global ones. The important thing about the Vodafone issue is what it says about India as a place to invest. I can't predict what the outcome will be. It is for the Indian government to take a decision. But, I welcome the fact that the government is reflecting on the way forward.

India has often cited example of Britain itself going for retrospective amendments to its taxation laws.
Yes, it did. It is true that Britain and many other countries made retrospective amendments. The difference with what happened with Vodafone is that our amendments were very narrow, technical amendments. What happened over the Vodafone case was something entirely different. The Supreme Court of India ruled something, and then the Indian government changed the law retrospectively. That did not happen in Britain. I am not aware of that happening anywhere else in the world.

Given the way the Euro zone is behaving, do you see an impact of the UK's investment on and trade relations with India?
Britain has very strong interest in a successful outcome of the Euro zone crisis. The Euro zone is our biggest trading partner, so it impacts us hugely. The crisis in Euro zone does not seem to be affecting bilateral trade relations between India and the UK, rather it seems to be benefitting it. Indian investors, when they are looking at where to invest in Europe, find the UK as a more attractive place to invest in than the Euro zone.

Part of the reason is the UK is not a member of the euro, part of the reason is the UK is a very attractive place to invest for Indians. In 2011, we saw Indians investing more in the UK than in the Euro zone.

India's exports to the UK were roughly around $12 billion in 2010-11, constituting just 4.77 per cent of India's total exports. Where do we go from here?
Yes, it could be much better. India did become the UK's largest market outside the European Union in 2011. In 2011, our goods exports to India jumped 40 per cent to 5.7 billion pounds. Indian investment in the UK continues to grow. Tata has become the largest manufacturing employer in the UK. The group employs 40,000 people, mostly in manufacturing. We want this example to be replicated in the next few years.

The same is the story the other way round. Vodafone has generated thousands of jobs, helped build an effective telecom network. BP's investment in a joint venture with Reliance Industries in the oil and gas sector was the largest in India ever so far.