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Britain is not cashing in on India’s growth as much as other nations

February 3, 2007

Although India is growing steadily at 8-9%, not all developed countries have rushed in to invest here. Britain is one of them. America and China seem to have the maximum faith in India as the graph below shows:

Well, China and the US have beaten Europe and grabbed the best slice of the Indian import pie, as this graph from The Economist (Jan 20th Issue) shows. Germany was a late mover but is catching up. Britain and France are at the bottom.
The Economist has not been very kind and blames Britain’s tardiness to invest in India on ‘relative sloth.’ The magazine explains it in detail but I have summarised it here.

1) British firms overestimated the difficulties of doing business in India
2) Britain assumed that it would outsource lots of menial jobs to India and move up the value chain
3) The high level of government (Indian) protectionism in the service sector which is Britain’s strength also discouraged Britian.

You can read the full story here.

I was seeing this in the context of the Goldman Sachs report. According to this report the position of Britain and France in the world’s economic hierarchy is expected to slip in the coming years. The United States is expected to be remain the top even as the BRIC nations (Brazil, Russia, India and China) start to rise.

Related Reading: The glory days of globalisation
Indian Real Estate booming

3 Comments leave one →
  1. February 4, 2007 7:49 am

    I guess thats because the Brits will only invest only if they are able to colonise a country.

  2. jithin permalink
    October 14, 2009 6:11 pm

    I agree everything.But still the 60% of the population hardly trying to find one meal a day back in india.I admite,it is not suitable to tell such a truth,when everybody is talking about developement.sorry.

  3. Mhd.ali permalink
    December 19, 2010 12:14 pm

    Brits trusts in Liquid form of investments like gold and energy sectors mainly. if India obtained a self sufficiency in energy sector, of course there is a hope. Long term investments are instable because of any time changeable policies of international powers.

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