Swraj Paul, U.K.-based Indian industrialist and Labour Peer, on Tuesday described India as one of the most business-friendly countries in the world citing the experience of his own company Caparo which, he said, had built 32 plants in India in the past eight years and employed nearly 9,000 people.
“We strongly believe there is long term potential in India and we want to be part of that growth,'' he told a gathering of business leaders pointing out that India's social and political stability was its strongest suit.
He said: “At a time when guerilla wars, insurrections, drug wars, kidnapping of businessmen and like happenings are so frequent, there are advantages in the stability of relatively lower violence societies. When ethnic tensions are worsening in many important countries, India has managed religious and ethnic issues rather well.''
Lord Paul, who was speaking at an Anglo-India summit organised by the Spectator magazine, said while every foreign investment decision was ultimately “a comparative judgment'' and based on an evaluation of “geo-risk'' India held up “pretty well'' by most yardsticks.
“India's democracy, slow and cumbersome as it is, provides an assurance that the business environment will not be hostage to unanticipated upheavals. Let me add another somewhat encouraging feature — India's population is about 50 per cent larger than that of all the four dozen or so countries of sub-Saharan Africa combined. It is about double the population of the whole of Latin America. Yet, the level of violence is, and has been, much lower than in Africa or Latin America.
Highlighting factors that, he said, favoured India , Lord Paul said: “First, the almost universal acceptance of free enterprise economics by all segments of political society. Social democrats, Communists, regional parties and almost the whole spectrum of the Indian political universe is now committed to globalised capitalism. This is a sea-change from the past and I believe it will endure.
Only rationale
Economic performance is becoming the only rationale for rewards at the polls, as we have seen in most recent regional and state elections. The impact of this in creating business-friendly policies is increasingly evident.''
State governments were acquiring a greater degree of policy-making independence.Lord Paul said the rise of grassroots civic organisations was having a major impact on Indian society. Civil society activism was evident all over the country and was being strongly supported by India's independent news media. “The confluence of rising social consciousness and the dramatically expanding electronic media is a potent force. Its effect on corruption — what I have called a ‘national disgrace' — is abundantly clear. The huge and spontaneous response to anti-corruption movements led by prominent social activists can only escalate,'' he said.
Describing corruption as “a two-way street'' with both givers and takers “equally at fault'', Lord Paul urged foreign investors to try and become “part of the solution'' by refusing to pay bribes.
“While India has to curtail its side, those who do business in India have to be more conscious that they should be less part of the problem and more part of the solution.''
