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India Economic Cooperation Programme summary 2022 to 2023

Published 30 March 2023

Overview

The UK is pursuing an ambitious Indo-Pacific agenda. Supporting growth in India and the UK features as a key foreign policy priority, articulated through the UK-India 2030 Roadmap. India’s economic growth and resilience is critical to UK’s trading ambitions and opening new markets for the future. This programme engages with a range of economic decision makers in the country and seeks to maximise the UK’s visibility with Government of India interlocutors, at both national and sub-national levels. Interventions build on previous and existing development efforts, with a strong focus on driving the UK-India bilateral agenda, highlighting UK expertise and supporting UK investments in the country.

The Programme aims to contribute to the following outcomes:

• secure Indian economic & regulatory reform, therefore reducing market access barriers
• enhanced UK policymaking and engagement in India through high-quality economic analysis and relationships across leading Indian economic policymakers and influencers
• deepen collaboration between the UK and Indian financial sectors and regulators, helping to realise potential for increased financial services trade and engagement between UK and India
• open opportunities for UK business and expertise to partner with India on investment, infrastructure and enterprise through UK innovative package of technical assistance and ODA funded investments

All these outcomes are nestled within 1 overarching programme titled India-UK Economic Co-operation Programme.

Objectives on economic co-operation

The themes chosen for the purpose of this programme, aim to showcase the best of UK capabilities to help address India’s key economic growth objectives. These include:

A. Economic policy engagement: Supporting India’s G20 Presidency and collaborate on shared economic challenges to help drive mutual UK-India growth.

B. Financial services: Creating and deepening financial services opportunities for UK firms in India, particularly in fintech and sustainable finance, which can be leveraged from City of London’s expertise.

C. Tax and regulation: Bilateral engagement with national regulators and sub-national institutions to improve end user experience for British companies in India and easing market entry.

D. Infrastructure: Technical assistance for efficient infrastructure development in India through the use of UK expertise and enhance participation, of international financial investors (including from the UK) in infrastructure and allied sectors.

E. Technology: UK data and technology led pilot initiatives at the state level to demonstrate both UK expertise and create commercial opportunities in the future.

Below are summaries of the projects being carried out in financial year 2022 to 2023:

• deliver customised capacity building modules in Goods and Service Tax (GST) for frontline tax officers in 2 to 3 states (regional governments). The modules are developed based on private sector feedback (including UK companies) and tailored to each State’s sector priorities. This will help UK businesses operating in the states to benefit from streamlined tax administrative processes. In the long run, it also deepens bilateral relations between UK and local governments in India. Additional projects were identified (proposed dialogue between Tax Administrators) in this financial year, likely to be prioritised in the future

• enhance regulatory co-operation with India across state and central systems in the Fintech eco-system, leveraging ongoing programme and responding to recent asks from Government of India on the back of the UK-India Economic & Financial Dialogue. Specifically, the programme will provide technical assistance support to develop the proposed Fintech bridge between Gift City and the UK

• providing policy inputs and running joint events to scale up our G20 partnership with India, during their G20 Presidency in 2023. Clear benefits both bilaterally (the programme will help give us priority access to & influence on India’s G20 policymakers) and multilaterally. As, after India’s Presidency in Year 3, we would like to continue the momentum by creating a Track 2 ‘Economic Experts Group’ which meets annually to discuss shared bilateral economic challenges, providing ideas for future cooperation under the Economic & Financial Dialogue

• a programme to cover analytical work, including approach to identify, appraise and approve climate impacts, concept for a platform for accessing climate finance including from UK investors, development of concept for credit enhancement and other financial instruments for facilitating climate finance including and strengthened focus from UK investors

• compendium of best practices, lessons learnt and guidance from past and present projects where Building Information Modelling (BIM) has been deployed in UK and India, focusing on cost / approach of deployment, complexity of deployment (BIM 1/ BIM 2) and the approach for spreading its use in major infrastructure projects in UK

• Showcase opportunities for UK’s institutional investors in the Indian infrastructure structures including through INVITs (Infrastructure Investment Trust), ToTs (Toll-operate-transfer), thematic bonds etc. The platform will have participation from policy makers, Indian project developers in addition to the UK investment community. The expectation is that the platform will be able to showcase selected opportunities for UK investors, feedback to the relevant policies and improve the flow of investment in India. FS priority as well

• FCDO supported DBT (formerly DIT) to collaborate with Confederation of Indian Industries’(CII) Indian Green Building Council and UK innovation hubs (KTN, CPC, Innovate UK, Cambridge Cleantech, Energy Catapults) to develop ‘India-UK Net Zero Accelerator Programme’. CII is a 125 year old not-for-profit, industry-led, and industry-managed organisation, with over 9,000 members from the private as well as public sectors, including SMEs and MNCs, and an indirect membership of over 300,000 enterprises from 294 national and regional sectoral industry bodies. CII works closely with Government on policy issues, interfacing with thought leaders, and holds the secretariat for B20 initiatives under India’s G20 Presidency. Partnering with them maximises UK visibility in the private sector domain

• an event in February 2023 focusing on technology cooperation and policy development between India and UK across clean growth sectors like net zero buildings, net zero energy, net zero water, net zero waste to landfill, and net zero carbon to support India’s transition to net zero. The project would cement UK’s position as a global climate leader by supporting development of relevant policies regarding climate change in developing countries like India. At the same time, the project would also strengthen technology cooperation between India and UK to help India’s transition to net zero. In addition to this, it would provide an opportunity for UK businesses to showcase their innovative clean technologies in India and explore potential collaborations and opportunities in the region

• a programme aiming to improve the accuracy of predicting Monsoon patterns in India. This programme complements existing WCSSP India partnership and will fund the Met Office to provide both research and commercial leadership for weather and climate ‘Science to Service’ applications. Once successfully implemented, these can be rolled out to other partner countries with the India project acting as the pilot

• SIN network supported a consortium led by Crop Health and Protection (CHAP) in 2021 to 2022 for 5 months to establish a sensor network prototype in Tamil Nadu. There will be a phase 2.0 of this project to help refine the entire prototype and make it private sector ready. The long term outcome is to prevent crop and environmental damage incurred by preventative pesticide application. A successful prototype will allow Agri-tech and F&B companies in India to adopt modern technologies available in the UK The long term outcome is to prevent crop and environmental damage incurred by preventative pesticide application. A successful prototype will allow Agri-tech and F&B companies in India to adopt modern technologies available in the UK

• a capacity building programme in which UK’s Animal and Plant Health Agency will work with India’s top mental health institute (NIMHANS) to strengthen their genomics surveillance and bioinformatics capacity, particularly in relation to Rabies. The principal objective is to enhance the data analytical and bioinformatics skills of personnel in the NIMHANS laboratory, which ensuring that their practises meet global standards. This brings global health security benefits to the UK and is directly related to the health goals in the 2030 UK-India Roadmap

Programme budget for financial year 2022 to 2023

The non-ODA budget for the economic co-operation programme is £1.5 million.