Modi to sign billion-dollar deals in the UK
November 12, 2015, 11:00 am

An $18-billion trade deal with the UK could put some muscle back into Modi’s political standing this week [Xinhua]

During his three-day state visit, his first to the UK as prime minister, Modi will meet with British leaders – including lunching with Queen Elizabeth II – and deliver a speech to the Indian community at Wembley Stadium.

But the focus of Modi’s trip will be to secure military and commercial deals – some economists estimate as much as $18 billion – and lure UK investors to pour monies into Indian infrastructure enterprises, among others.

India, the world’s fourth largest economy, is the third biggest investor in the British economy, but the UK is the 18th largest trading partner with Delhi.

Cameron has called Modi’s visit a historic opportunity to strengthen and revitalize links with India, which is expected to record a 7.3 per cent economic growth rate this year – surpassing China.

India is hoping that trade with the UK, which retreated by 10 per cent in the past year, will pick up again and that British investors can capitalize on the latest batch of reforms taken by Delhi earlier this week.

The Indian government announced on Tuesday it had eased foreign direct investment norms in 15 major sectors, including mining, defence, civil aviation and broadcasting.

Regional air services would be allowed foreign investment up to 49% under the automatic route.

The FDI policy in single brand retail was relaxed, allowing companies to sell products through e-commerce.

The trip itself will likely soften the blow Modi suffered when his ruling Bharatiya Janata Party lost the regional vote in the key central Indian state of Bihar, putting at risk his hopes for a majority in the upper house of Parliament to pass reforms.

The BRICS Post with inputs from Agencies