BUSINESS

U.K. budget a boost to R&D

LONDON, MARCH 17. In what is widely rated as a pre-election `give away' budget, Gordon Brown, the British Finance Minister (Chancellor of the Exchequer), has aroused expectations about the heath and future of the British economy and nurtured British national quest for crucial administrative and economic reforms to improve British companies' competitive edge in service and manufacturing sectors.

In fact, Mr. Brown is seen challenging other leading European Union countries on reform with enviable growth of the British economy (3.5 per cent compared to less than 0.5 per cent for Germany) and record low unemployment — less than 4 per cent of the workforce compared to nearly 9 per cent in France and Germany.

With the British GDP (gross domestic product) hovering round $1.4 trillion mark, Wednesday's British budget is seen tackling the need for more innovation and a drastic improvement in British productivity levels all round to secure a better share of global trade and investment flows. It is also ironical to note that, Mr. Brown has no psychological and political inhibitions to follow the example of Asia's fast emerging economies, particularly China and Japan. The British authorities are commissioning a review into how Britain's creative industries can help its manufacturers.

The traditional British expertise in software, advertising, the media and universities can further boost the British economy. The current quandary is that while traditional sectors' current output has improved, the core of total economic output has shrunk. Britain has performed better than France and Germany since 1997, following key economic and labour reforms initiated by Margaret Thatcher. But it has failed to keep up with dynamic Asian economies — owing to smaller flow of investments, rising taxes and bureaucratic or regulation burden imposed by traditional British `red tape' on businesses and industries. All this has retarded rate of capital accumulation and eroded somewhat the British competitive edge in the global market place. Widely rated as the next Prime Minister of Britain — if the New Labour wins the general election in coming weeks — Mr. Gordon Brown is seen as emerging `reformist' trail blazer in the economic and financial forums of the European Union. One third of India's current two-way trade is with the EU countries. In the competitive edge scoreboard Britain has drooped to the 22nd place in the world from ninth in 1997.

PTI reports:

Mr. Gordon Brown's ninth budget saw stamp duty and inheritance tax thresholds rise, and a rise in the pensioner credit of 13 per cent by 2008, ensuring a minimum pensioner income of 119 pounds a week.

He flagged up a plethora of new `science cities' and announced a new national framework for stem cell research and a new design centre in Newcastle.

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