Trade and Investment Opportunities with India
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House of Commons Trade and Industry Committee Trade and Investment Opportunities with India Third Report of Session 2005–06 Volume II Oral and written evidence Ordered by The House of Commons to be printed 13 June 2006 HC 881-II Published on 27 July 2006 by authority of the House of Commons London: The Stationery Office Limited £20.50 The Trade and Industry Committee The Trade and Industry Committee is appointed by the House of Commons to examine the expenditure, administration, and policy of the Department of Trade and Industry. Current membership Peter Luff MP (Conservative, Mid Worcestershire) (Chairman) Roger Berry MP (Labour, Kingswood) Mr Brian Binley MP (Conservative, Northampton South) Mr Peter Bone MP (Conservative, Wellingborough) Mr Michael Clapham MP (Labour, Barnsley West and Penistone) Mrs Claire Curtis-Thomas MP (Labour, Crosby) Mr Lindsay Hoyle MP (Labour, Chorley) Mr Mark Hunter MP (Liberal Democrat, Cheadle) Miss Julie Kirkbride MP (Conservative, Bromsgrove) Judy Mallaber MP (Labour, Amber Valley) Rob Marris MP (Labour, Wolverhampton South West) Anne Moffat MP (Labour, East Lothian) Mr Mike Weir MP (Scottish National Party, Angus) Mr Anthony Wright MP (Labour, Great Yarmouth) Powers The committee is one of the departmental select committees, the powers of which are set out in House of Commons Standing Orders, principally in SO No 152. These are available on the Internet via www.parliament.uk. Publications The Reports and evidence of the Committee are published by The Stationery Office by Order of the House. All publications of the Committee (including press notices) are on the Internet at http://www.parliament.uk/parliamentary_committees/trade_and_industry.cfm. Committee staff The current staff of the Committee are Elizabeth Flood (Clerk), Glenn McKee (Second Clerk), Robert Cope (Committee Specialist), Grahame Allen (Inquiry Manager), Clare Genis (Committee Assistant) and Joanne Larcombe (Secretary). Contacts All correspondence should be addressed to the Clerks of the Trade and Industry Committee, House of Commons, 7 Millbank, London SW1P 3JA. The telephone number for general enquiries is 020 7219 5777; the Committee’s email address is [email protected]. Witnesses Tuesday 31 January 2006 Page Mr A S Lakshminarayanan, Tata Consultancy Services and Mr Edward Gardner, Diligenta Ev 1 Mr John Ainley, Aviva Offshore Services and Mr Sean Egan, Norwich Union Ev 8 Tuesday 14 February 2006 Mr Paul Whiteway and Mr Asif Ahmad UK Trade and Investment Ev 15 Tuesday 28 February 2006 Mr Karan Bilimoria CBE and Dr Shailendra Vyakarnam, Indo British Partnership Network Ev 31 Tuesday 14 March 2006 Mr Sonjoy Chatterjee, Mr Anwar Hasan and Mr Sirjiwan Singh, The India Group Ev 46 Tuesday 21 March 2006 Mr Ian Pearson MP, Minister for Trade and Mr Paul Madden, Department of Trade and Industry, Mr Tony Collingridge and Mr Asif Ahmad, UK Trade & Investment Ev 59 Tuesday 25 April 2006 Lord Patten of Barnes and Dr Tidu Mani Ev 74 Ms Catherine Stephens and Ms Victoria Grant, British Council Ev 81 List of written evidence Page 1 Astaire and Partners Ev 89 2 Aviva Ev 90 3 British Chambers of Commerce (BCC) Ev 94 4 British Consultants and Construction Bureau (BCCB) Ev 94 5 British Council Ev 95 6 British Council Ev 97 7 British Council Ev 100 8 Cambridge Assessment Ev 100 9 City of London Ev 102 10 Clifford Chance Ev 104 11 Commonwealth Business Council (CBC) Ev 107 12 Confederation of British Industry (CBI) Ev 118 13 Dalit Solidarity Network UK Ev 121 14 EEF Ev 126 15 Federation of Indian Chambers of Commerce and Industry (FICCI) Ev 130 16 Imperial College London Ev 131 17 Indo British Partnership Network (IBPN) Ev 133 18 Intellect UK Ev 137 19 James E Lynch India and South Asia Business Centre Ev 139 20 Morgan Walker Ev 142 21 Rio Tinto Ev 143 22 Rolls- Royce Ev 146 23 Scott Wilson Ev 147 24 Society of British Aerospace Companies (SBAC) Ev 148 25 TATA Consultancy Services (TCS) Ev 152 26 TATA Consultancy Services (TCS) Ev 153 27 The India Group Ev 154 28 The Scotch Whisky Association Ev 160 29 UK Trade & Investment (UKTI) Ev 163 30 UK Trade & Investment (UKTI) Ev 172 31 UK Trade & Investment (UKTI) Ev 175 32 UK Trade & Investment (UKTI) Ev 179 33 UK-India Education Research Initiative (UKIERI) Ev 184 34 University of Wolverhampton Ev 186 35 Xansa (India) Ltd Ev 187 36 Richard Perry Ev 187 Trade and Industry Committee: Evidence Ev 1 Oral evidence Taken before the Trade and Industry Committee on Tuesday 31 January 2006 Members present: Mr Peter LuV, in the Chair Roger Berry Miss Julie Kirkbride Mr Brian Binley Judy Mallaber Mr Peter Bone Rob Marris Mrs Claire Curtis-Thomas Anne MoVat Mark Hunter Mr Mike Weir Mr Lindsay Hoyle Mr Anthony Wright Witnesses: Mr A S Lakshminarayanan, Vice President and Country Head, Tata Consultancy Services, and Mr Edward Gardner, Financial Director, Diligenta, gave evidence. Q1 Chairman: Gentlemen, welcome to our first a little bit about the general background and how evidence session of this inquiry into trade and TCS fits into Tata, so that we understand the general investment opportunities with India. We are very framework? grateful to you for being our first witnesses. I ought Mr Lakshminarayanan: TCS is the young kid on the to start with a small procedural formality, which is block in the Tata family. The Tata Group itself that a number of us round the table, myself included, started in 1868 and they have seven clusters of have from time to time been guests of the Indian businesses, and within each of the clusters there are Government on visits to India, and I myself also was over 80 diVerent operating businesses. In the UK there with Richard Branson in March for the launch they have been present since 1907, and there are of Virgin Atlantic. That is a sort of generic several companies that operate here, including declaration of interest, which does not apply to all Tetley tea, and the St James Court Hotel, which is members of the Committee but to some of us. I do part of the Taj group of hotels, and several other not think anyone else has any relevant interest to companies. Tata Consultancy Services is part of this declare. This is a very important inquiry for the group. We started in 1968 and we have been present Committee, because I hope it will both draw to wider here since 1975. attention the opportunities that exist for wider and deeper trade between our two countries, and also, in terms of our final report and its recommendations, Q3 Chairman: I am interested about how big Tata is more importantly, identify any obstacles that exist in the UK. You mentioned Tetley, which is to furthering that process which should be swept obviously a well-known brand. How big is Tata and away to encourage that trade to deepen; but, of TCS in the UK? course, you are already experts in the field of trade Mr Lakshminarayanan: The Tata Group itself has a between our two countries. Can I ask you, perhaps number of diVerent organisations here. Tata Ltd has before we start asking you our questions, to identify had a presence here—they are in Grosvenor Place— yourself for the record for the Committee? since 1907, as I mentioned. The Tetley group, in Mr Lakshminarayanan: My name is Lakshmi. My full name is Lakshminarayanan. I am Vice President terms of revenue, is 190 million. There is Tata Elxsi, of TCS, which is Tata Consultancy Services. I have which is another technology company, Tata been with the company for 22 years. I have been in Technology, which is an arm of Tata Motors, the UK working with various projects and looking at automotive specific engineering—they companies for the last 14 years and doing this have a presence here of about 200 people—and Tata current role, which is heading up the UK and Ireland Consultancy Services, which recently also acquired operations for the last six years. Tata Infotech. Tata Consultancy have about 70 Mr Gardner: My name is Ed Gardner. I head up the customers here in the UK. We have roughly about finance function for Tata Consultancy Services, 2,000 people here in the UK and about 5,000 people which is TCS, in the UK. I recently joined TCS in working out of various locations, primarily out of July 2005, so very recently, and I was helping them India but also in Budapest, servicing the UK refine their oVer for the business processing customers. Broadly, that is the size of the group. outsourcing they—we—are doing for Pearl up at Peterborough. Prior to joining TCS I was the Chief Financial OYcer for Sun Life of Canada, and that is Q4 Chairman: One final introductory question, based down in Basingstoke, Hampshire. perhaps you could explain for the record the nature of the services you operate. Too many British people Q2 Chairman: I wonder if we could start with one or think you might just be a provider of call-centre two general questions about Tata, which is quite a services, which is clearly a very serious big company to say the least. Could you explain just misunderstanding of what you do. Ev 2 Trade and Industry Committee: Evidence 31 January 2006 Tata Consultancy Services and Diligenta Mr Lakshminarayanan: Actually we are not in the Mr Lakshminarayanan: India, as we all know, call-centre business at all. We divested what we had started only liberalising since the 1990s. For a very in the call-centre area. We are primarily IT brief period of about three years I was heading the consulting, an IT services provider: that is about insurance practice in India where we were actively 90% of our business.