Speech at the Confederation of Indian Industry
“The UK and India: Low Carbon Economies Working in Partnership”
12th March, 2010
I am delighted to be in Kolkata, for what is my first and very overdue visit to your wonderful city.
I am the UK’s Special Representative for International Trade and Investment and I am delighted to be here addressing such a distinguished group this afternoon. As I have said, this is my first visit to this great city, which shares deep historical ties with Britain, stretching back to 1686 when Job Charnock first sailed up the Hooghly River.
It is of course Kolkata’s location on this river, its trading prominence as a major port, and its entrepreneurial people which have put the city at the heart of free trade across the world; first by the East India Company and then in the industrial revolution in India which gave you a leading role in what we now call globalisation. It is also clear that West Bengal is a huge part of the intellectual power of India today.
In my role as the United Kingdom’s Special Representative for International Trade and Investment I seek to help UK business grow and succeed in an increasingly competitive and global economy. In this role I also encourage overseas companies who are possibly or should be planning to invest overseas to base themselves in the UK, which gives you the best access to the largest market in the world – the European Union.
In addition, I am here in India to learn about the new opportunities in the Indian market, to see them for myself and to disseminate that knowledge to government and business when I return to the UK. Many links have been created with India in recent decades, both cultural, historic and in business. I am keen to develop these further and also, most importantly, our trade and investment partnership, and in particular between the UK and West Bengal.
Apart from obvious strong political, educational and cultural ties, trade and investment is a key part of Britain’s relationship with India. Trade between our two countries was worth £12.6bn last year and India was one of the biggest inward investors in the UK, creating well over 4000 new jobs with over 100 new projects in the UK. The UK is the biggest European investor in India, and the fourth largest globally.
This relationship continues apace, Indian companies continue to innovate and move up the value chain and UK companies become ever more aware of the benefits of doing business in this exciting and dynamic market.
Turning to my topic for today: As the global economy begins to recover, as it is perhaps beginning to do, we all face major challenges. On the economic front, there is still much to be done to make this recovery sustainable. And threatening that sustainability, we are warned that global climate change is likely to put millions at risk from rising sea levels, lack of water and food scarcity, and the instability which will result from mass economic migration, brought about by the consequences of our attempts to control our planet’s destiny, be it climatically or socially.
And India is particularly vulnerable to the impact of climate change due to its economy being closely tied to agriculture, and its 7500-km long coastline, which is both low-lying and densely populated. This threat will obviously resonate strongly in this part of India in particular, with the low-lying Sundarbans delta.
The recent global talks in Copenhagen were a clear reminder that the necessary transition to a global lower carbon economy can only be achieved through collaboration between Governments and the private sector.
Low carbon is already a big industry and it is set to increase dramatically in the UK. The global market for low carbon and environmental goods and services was already worth £3 trillion in 2008. As international activity in climate change gathers momentum, this could grow to an estimated £4.3 trillion by 2015. Britain recognises the need to make the most of these business opportunities and plans to do so by investing in education, in research into and in development of the technologies that will drive this growth in the future.
The importance of a low carbon economy is now hardwired into our business culture. A significant proportion of UK businesses see this as an opportunity, not a threat, and are working hard to exploit it, either by breaking into new markets or by making their existing operations more efficient.
It is already clear that the transition to a global low carbon economy is creating business opportunities for many – now especially those with the right products and services which are ready for the market today.
Many of our new generation of low carbon companies are being born directly out of University research, operating at the forefront of nanotechnology, biotechnology and computer science. For instance,
• a new electric high-performance vehicle from Delta Motorsports, in association with Oxford University;
• construction materials produced from recycled waste, by Carbon8 in association with Greenwich University;
• and new high tech materials, which absorb and treat carbon, from Nanoporous Materials in association with Bath University;
In addition, the track record of Cambridge and Oxford Universities and Imperial College London in commercialising their research and transferring it from the lab bench to the market place is among the best in the world.
The shift towards low carbon represents a huge economic opportunity, not only for Britain, by offering huge cost savings to businesses and the public sector in the form of energy and resource efficiency – at the same time as cut carbon output.
The UK is now, probably, the world’s global hub for low carbon technologies and services, cutting across a range of industries. The UK’s Low Carbon Strategy is helping to open up new opportunities for business in terms of innovation, new technologies, green infrastructure and a host of related service industries.
There are a number of sectors in which the UK is already active in India and where there is scope for greater collaboration – wind, wave and solar energy for example.
I am aware that coal plays a key role in India’s energy mix and is going to remain the main source of energy for the foreseeable future. There is an increasing interest in cleaner coal technologies; another area where Indian and UK companies have been working together for a considerable time. The UK has expertise in almost all parts of the coal value chain: sustainable mining solutions, coal washing, advanced combustion technologies for thermal power plants and fly ash utilisation technologies, for example. These will all be of particular relevance in this part of the country, which contains about 70% of India’s coal reserves.
Some people are surprised when I tell them that the UK is still the sixth biggest manufacturer in the World. Manufacturing is in our blood; it is a key part of our economy, and whilst recovery is somewhat limited in the UK as of today, it is our determination that this should grow as a part of the UK Pie chart of outputs rather than shrinking in the years ahead.
The India-UK Industrial Innovation Forum is developing new initiatives on sustainable manufacturing solutions. Through this initiative, UK academia and industry are working with Indian partners, including CII, to exchange ideas on low-carbon, low-resource manufacturing solutions.
The UK is also working with the Indian steel industry on the use of alternative energy sources and carbon abatement technologies. With the majority of India’s integrated steel plants located in the Eastern region, this is one more area, I imagine, where there is a high local interest.
In terms of vehicles, The UK is a world leader in low carbon automotive technologies. This expertise was shown at the Environmental Friendly Vehicles Event and Auto Expo in Delhi earlier this year. There will be an Indian low carbon automotive business delegation visiting the UK later this month.
The Planning Commission has said that action on climate change and on poverty alleviation will have to go hand in hand. And whilst I have enormous respect for what India has achieved during the last two decades in lifting people out of poverty, it is clear that huge challenges remain in both arenas of endeavour.
The UK and India have a truly modern, forward looking, 21st Century relationship. We are both nations of innovators and entrepreneurs. We both cherish creativity and we both value science and innovation. And we are all aware that the challenges we, and the World, face in terms of climate change, energy, food security and poverty alleviation are very real, and that big ideas, drawing on the imagination of Universities, business and to a lesser extent governments, are essential if we are to succeed in overcoming them.
I know that there is great scope for collaboration now and in the future between the UK and India in this area and in many others I haven’t covered this afternoon. We both need to be leaders in the respective strengths of our industrial heritage, and also of the emerging low carbon industrial revolution, and I look forward to supporting exciting joint developments both now and in the future.