Mr Major’s Joint Press Conference with Director General of CBI – 25 January 1993
Below is the text of Mr Major’s joint press conference with the Director General of the CBI, Howard Davies, held in New Delhi on Monday 25th January 1993.
PRIME MINISTER:
Can I say at the outset how delighted I am to have been invited to be India’s guest on Republic Day, I believe it is the first occasion that a British Prime Minister has been invited and honoured in this fashion and I am delighted to have had such a remarkable privilege.
I think in one sense this does indicate with great clarity the changing and improving relationship between India and the United Kingdom. What is equally clear and has been wholly clear to me in my discussions today, is the extent to which India is changing and opening its doors a good deal more widely to the world. It is no coincidence, I believe, that shortly after I leave President Yeltsin will be arriving and Chancellor Kohl will be there very shortly after that.
I have had the opportunity today to have discussions with the President, with the Vice-President, with the Prime Minister, the Minister for Home Affairs, the Minister of Finance and the Minister for External Affairs. It is absolutely clear to me that relations between the two countries have I believe never been closer since Independence. There are nearly 1 million people of Indian origin living in Britain, they play a very prominent part in the life of the United Kingdom. We have a very large amount of foreign investment in India, our exports last year to India were very nearly 1 billion pounds and India of course remained by far our largest aid recipient.
My reasons for coming here, apart from the invitation, were threefold; firstly political, second economic, and thirdly commercial. Politically I have been able to reaffirm our support for India’s deep-rooted democracy, I think it is extremely important and remarkable achievements have been made over the past 40 years or so. In particular I welcome the strength with which the Indian government has reaffirmed its commitment to the rule of law, to the secular constitution and to tolerance and protection for minorities.
In our discussions today I have reaffirmed our cooperation, our joint cooperation, in the fight against terrorism and I have confirmed also that we are fully committed to using our law to this end.
I have had the opportunity, with the Prime Minister in particular, of discussing the issue of greatest concern to them and their neighbour Pakistan – namely Kashmir. I believe that is essentially an issue for the two governments themselves to resolve, albeit with the strong encouragement of their friends. The principles which underlie our approach to this problem I think are well known, we wish to see a dialogue between India and Pakistan, a genuine political process in Kashmir and respect for human rights and an end to external support for violence in Kashmir.
On the economic front I was very pleased to hear from the Prime Minister of India’s determination to pursue her programme of economic reform and liberalisation. That is not something we would have heard just a few years ago, today it is a very clear clarion call to the future that forms a central part of India’s policies. And one of the things that emerged from my discussions and from the separate discussions with British businessmen has been the commitment of all concerned to that reform and the belief that that reform is already bringing results. I believe that India will see the benefits of her perseverance in terms of large scale support from the IMF and more relevantly in terms of economic results here in India. We have as a country very long-standing commercial ties with India, but one change that economic reform has certainly brought about is that it is now much easier for private sector companies to do business directly with the private sector in India and they are certainly very keen to do so.
I have brought with me to India one of the most senior groups of British businessmen ever to come to India and with them Howard Davies, the Director General of the CBI. Some very significant contracts are under discussion. I am certainly delighted to tell you that British Gas has this afternoon agreed a 100 million pound joint venture project with the gas authority of India for a natural gas distribution project in Bombay. And British Aerospace has today signed an agreement with Hindustan Aeronautics for software. A number of other contracts are being discussed and are due for agreement. We want to build on that, by we I mean the governments of India and the United Kingdom and the private sector in both countries as well. We seek to translate India’s economic reform into a revitalised commercial relationship.
Yesterday, British businessmen met their opposite numbers in business and also met senior government officials. They have launched their initiative, they have launched a partnership initiative led not by government but by the private sector. On our side the group will help increase awareness in Britain of the opportunities to do business with India. Prime Minister Rao and I have agreed this morning to give this initiative our personal support and we have asked for a report on the progress made, and the achievements made, critically the achievements made, to be given to us at the end of this year and I have no doubt that Howard Davies will say a little more about this in a minute. But it is that partnership that will lead to more investment and to more exports. Each of the businessmen has said that he will be pursuing the contacts made during this visit and those of you who may have spoken to the businessmen will know how enthusiastic they are about the opportunities opening up.
India already is the world’s 14th largest economy. Other countries are already moving to build on the opportunities that that represents. British investment in India will help India’s economic reform, export growth will lead our domestic recovery, there is a joint interest that both of us wish to exploit. We have as two countries an historic relationship. In this visit we have been looking to develop a modern partnership as well and I believe it has been very fruitful and we have begun to do that.
MR DAVIES:
For the benefit of Indian journalists here I should point out that the CBI in England is not the Central Bureau of Investigation and emphasise the Prime Minister is not under investigation, not from me.
From the business point of view, this has been an outstandingly successful trip. The Prime Minister has announced two particular deals involving British Gas and British Aerospace, I mentioned a third yesterday involving Cadbury’s increased investment in India.
British Gas have today reached agreement with the gas authority of India to form a joint venture company to supply natural gas to the city of Bombay. The investment by the new company will total around 100 million pounds but the significance of the agreement is broader since it puts British Gas in pole position in the development of natural gas in India which could lead to between 1.5 – 2 billion pounds worth of business in the longer term. And there will be many opportunities within those contracts for other British suppliers.
British Aerospace signed a contract today with Hindustan Aeronautics Limited to found a joint software company, it involves a satellite link between Bangalore and Warton in Lancashire so that software engineers and designers in India may work jointly with their colleagues in Britain. Clearly that is a further strengthening of the link between the aerospace industries of India and the UK.
Other companies on the team have been in active negotiation around the main meeting and much other progress has been made, further important contracts are expected in power generation and elsewhere.
All these negotiations have been hugely assisted by the Prime Minister’s presence here and by the access to decision-makers that that has guaranteed for the business team. We have had a very interesting programme and we are extremely grateful to the Indian side for their hospitality and indeed for the patience with which they have answered our detailed questions.
I mentioned yesterday our meeting with the businessmen and the Permanent Secretaries on Sunday. Today the business team met the Ministers of Commerce and Finance and then we collectively reported back on our discussion to the two Prime Ministers, a very unusual type of meeting but which was a great privilege for us. We said that we had been very impressed by the commitment to liberalisation and reform, this had been evidenced by all the Indians we had met. We did, however, press for further progress on liberalisation and indeed suggested a private sector-led initiative to raise the awareness in Britain of opportunities for trade and investment in India, matched by a similar effort over here. We believe the timing for such an initiative is exactly right since the opening of the Indian market gives a lot of encouragement to British companies who have been here already and who propose to invest.
The British effort will be led by Robert Evans, the Chairman of British Gas, with CBI help and the Prime Minister has agreed to support, provide a secretariat and other assistance, for that initiative and that applies on both sides. We will report back to the Prime Ministers in a year on the progress made and the group of business people here are very committed to pursuing that.
Particularly perhaps of interest to the British press, a couple of hours ago in London the CBI’s most recent quarterly industrial trend survey was issued. It showed the sharpest increase in business confidence for 5 years with strong optimism about export prospects. One-third of manufacturers were more optimistic about exports than four months ago. Prices in export markets for British manufacturers are not a problem, the main remaining restraint on exports reported by 40 percent of companies is political and economic conditions abroad. That from the business point of view is the context for this visit, the government in partnership with industry trying to create more favourable conditions for British exports and investment. We have been asking for more government support for exporters for some time and now we are getting it. The business group is very chipper as a result and for a number of them this has been a nice little earner and I cannot translate that into the Anglo-Indian idiom.
QUESTIONS AND ANSWERS
QUESTION (Dubai Gulf News):
During your meeting today with the British media, you are reported to have told them by way of explaining the British Government’s position on Kashmir, that any solution to the Kashmir issue should take account among other things of the aspirations of the people – I think you used the expression “the population of Kashmir”. My question is would you please elaborate what you meant by this particular word “aspirations”, whether it is another word for “referendum” and did you discuss this with the Indian Government as apparently in your opening remarks you did not make any reference to that particular word “aspirations”?
Secondly, by “Kashmir” do you mean all the parts in India and Pakistan?
PRIME MINISTER:
I am not quite sure from where you got that quote or what detailed interview people are supposed to be referring to but it is certainly a novelty to me. Yes, I did discuss the matter with the Prime Minister this morning; I discussed it privately as an old friend of India, indeed as an old friend of Pakistan as well, we are all members of the Commonwealth.
I don’t believe advice on how to deal with this problem best comes publicly from third party governments. Any comments in detail I may have upon it I think are best given privately to the Prime Ministers concerned and that, other than the general position I set: out in my statement, is what I will maintain.
QUESTION (Charles Wright, Evening Standard):
Prime Minister, can I ask you just on a domestic note since Howard Davies has mentioned it, your reaction to that rather encouraging CBI quarterly trend survey and on a less happy note here, your thoughts about the stories about various terrorist threats?
PRIME MINISTER:
If I can deal with the domestic matter first, I am clearly delighted. I have not had a chance yet to study all the details of the survey but one of the necessary ingredients for lasting recovery is confidence amongst companies at home about their prospects at home and their prospects to export. If that confidence is there, the other basic ingredients encouraging people to develop their companies and for the economy to grow are clearly in place: lower interest rates than we have had for a long time; the inflation rate well under control, far lower than we have had for a long time; and also a very competitive exchange rate so the ingredients for investment and for recovery are there. The missing ingredient for a long time has been the confidence amongst businessmen themselves that they will be able to build on the economic scene at home. So to that extent, it is very good news indeed that we have this survey showing such dramatically increased confidence; I look forward to it being translated into dramatically increased action and that of course is a matter for the private sector. I very much hope that they will be able to do that.
On the second half of your question, I am entirely content with the security arrangements that have been made here. We had been in touch with the Indian authorities for some time about security matters during this visit and all those discussions have been entirely satisfactory.
I think probably the threats you refer to come specifically from our commitment to the extradition treaty. I have no reservation about that treaty whatsoever. We, by which I mean the Indian Government and the British Government, are two governments amongst many that have to deal with international terrorism. Terrorism is a problem that each and every government across the world will need to combat and they will often need to coordinate their efforts so I don’t believe any threats, wherever they may come from or for whatever reason they may come, change the necessity to deal with the terrorist threat in each and every country around the world so I am perfectly content with the security arrangements that have been made.
QUESTION (BBC):
Prime Minister, you have made a friendly offer of help, if invited by Pakistan and India, in resolving the Kashmir dispute. If invited, how do you envisage the role of the United Kingdom, in what capacity in that unresolved problem? If not resolved during a period, what kind of pressure or what kind of persuasion do you think you can exercise?
PRIME MINISTER:
I am glad you asked that question because it enables me to clarify a misunderstanding that I have certainly seen reported in a number of newspapers.
At no stage have we suggested or have I had it in my mind to suggest that Britain should be an intermediary between Pakistan and India. At no stage has that been our intention and at no stage has that suggestion been made.
This difficult and intractable problem will not, I believe, be solved by an intermediary; it will be solved by the governments of India and Pakistan.
What we have said is that as longstanding and close friends of both countries, as a senior member of the Commonwealth, we are keen to see them get together and do what they can to solve the problem and if they believe that there is any way in which we or others can assist, then we are there prepared to be asked for that assistance but it is not for us to artificially offer to broker a solution. I don’t believe that would be appropriate, we have not done it and we are not going to do it.
QUESTION (IMPAH):
Mr. Prime Minister, did you talk to the Government of India about Indo-British military cooperation because their latest problem is about the Air Jet trainer? Did you speak to the Prime Minister about that?
PRIME MINISTER:
We spoke about a number of matters including that one, yes.
QUESTION (LADY ALSO FROM IMPAH):
Prime Minister, some temples were demolished in your country recently. What action is your government contemplating on that if any at all?
PRIME MINISTER:
Wherever people break the law, they are subjected to the rigours of the law and all such matters of that sort are investigated by the police and where appropriate, action is taken. Our law requires that and that is what happens.
SAME LADY:
Is your government planning any action or why hasn’t taken any action so far?
PRIME MINISTER:
It is a matter for the police. Where action like that occurs, it is a matter for the police and the police will and are dealing with it.
QUESTION (TV Asia, London):
With more than one million Indians settled in Britain, would it not have been encouraging if you had included an Indian businessman in your delegation?
PRIME MINISTER:
It wasn’t entirely my delegation. I would have been delighted to have brought an Indian businessman with me and perhaps on a future occasion I will be able to do so.
I am delighted that the Indians are playing a much greater role both in the business community and increasingly in politics in the United Kingdom. I think there have been very great advances on both those fronts over the last few years and I thoroughly welcome that.
I hope on a future occasion we will have some Indian businessmen but I suppose it is possible that they may think their contacts here perhaps don’t require them to come with me!
QUESTION (Yugoslavian News Agency TANYUK):
Mr. Prime Minister, recently you said to the “Hindustan Times” that Great Britain is playing a leading role in resolving the Yugoslavian crisis. Tell me please, what are you going to do about this Croatian aggression in the United Nations protected areas populated by Serbs where in two or three days many Serb civilians were killed?
Secondly, are you actually going to take steps towards lifting the unjustified sanctions on the Federal Republic of Yugoslavia or are you going to persuade and continue the politics of punishing Serbian people only because they did not agree to and the degradation of their country?
PRIME MINISTER:
With respect, I am not entirely sure I agree with some of the premises upon which you base that question. I think some of them are contentious and you will be unsurprised to know that I don’t accept them.
As for our position on the general crisis in Yugoslavia, I think there are several points that I might justifiably make about the position of the British Government.
Firstly, the London Conference and the Vance-Owen peace proposals spring essentially from the conference I chaired during our Presidency of the European Community. The Vance-Owen team have made far more progress, I think, than many people may have imagined. There is still more to be done; there is still no agreement on the maps that they, have presented to the various parties but the progress that they have made thus far has been astonishing; few people would have expected it; I am delighted it has taken place and they must continue their work. I believe a political settlement is the only satisfactory conclusion that we will get out of the present difficulties that exist in Yugoslavia.
The second point I would make is about the immense degree of hardship faced by many people especially – not universally but especially – in Bosnia and I believe the part that the United Kingdom has taken in the delivery of humanitarian aid both by the humanitarian agencies and provided by the United Kingdom and also provided by others – but a very large amount of the aid, the medicines and the food was provided by the United Kingdom – and also the fact that we have far more troops working to assist the delivery of humanitarian aid in Bosnia than any other country shows that in a raft of ways we have played a leading role in seeking to bring this affair to a conclusion and to minimise suffering until such time as it does end.
On the specific point about Croatia, I think the right way to deal with the problems in Croatia and elsewhere is through the Vance-Owen dialogue and I know that is being pursued.
QUESTION (Business Standard, Calcutta):
I would like to know whether the recent communal disturbances in India have in any way influenced British perceptions on investment in India and also whether Britain would like to influence public opinion in the West on this issue?
PRIME MINISTER:
Why ask me when you have the Director-General of the Confederation of British Industry here? I will ask Howard to reply.
HOWARD DAVIES:
I think that it has not. British business people have been concerned by those disturbances because of the human cost which is upsetting to business people in Britain as it is elsewhere but we do not interpret that as being about the economic reform programme and we have been assured that that programme proceeds so I think that we as business people not wishing to involve ourselves in purely political matters have set that aside and have concentrated on what we have heard from the Government about the reform programme. Nobody who was planning to come on the trip didn’t come as a result of that news so we have pressed on regardless.
QUESTION (Economic Times):
You mentioned a lot of interest of the business delegation and all this has come without any progress on our labour laws. Has there been some assurance from our Government regarding something done on this or are the labour laws not so important for the British businessmen?
Secondly, Mr. Prime Minister, there were some reports saying that there was some softening or a more sympathetic stance from the British towards India’s views on the Non-Proliferation Treaty. What discussions regarding this have you had with our Prime Minister and what are your views?
PRIME MINISTER:
Clearly, every aspect of economic relations dealing with competition in the country is of interest to us so we are very keen to see the liberalisation in all its aspects that the Indian Government are moving towards.
I believe the extent to which they have moved in the last two years has astonished many people and delighted India’s friends and I am in no doubt after my discussions today that the Government propose to move more towards liberalisation. Clearly, they will have to take some things at a measured pace and it is not for me to predict which measures they will deal with most speedily but I think they are very conscious of the need for changes.
On the Non-Proliferation Treaty, I think everyone around the world wishes to see the extension of the Non-Proliferation Treaty. What I have said is that I can understand the difficulties faced by a number of countries in particular circumstances. I understand India’s position on the Non-Proliferation Treaty. I would still like India and Pakistan and other countries – the 32 who have not yet signed it – I would like to see all those countries signing the Non-Proliferation Treaty. The more one gets non-proliferation as a common cause, the easier it is for the two superpowers in particular but the other nuclear weapon-holders as well to begin increasingly to scale down their own nuclear capacity and believe that is something that every sane person would wish to see.
QUESTION:
Prime Minister, are you aware of the sentiments of British Hindus regarding the closing of a Rama Krishna temple in London?
PRIME MINISTER:
No. I have not had any discussion with them about that. I am aware of the case but I have had no discussions with them about it but very probably the Home Secretary will have done and he was here very recently; he may well have responded to questions like that.
QUESTION:
Mr. Prime Minister, after talking with your Indian counterpart, I think you are satisfied with India’s new economic policy. In 1997, Hong Kong is going to China. Will you advise your Hong Kong people or Indian people that India is the right place, “You have no need to go to UK or USA for settlement, India is the right place for investment!”?
PRIME MINISTER:
There is a lot of investment available in a number of countries and if I may restrict myself to India, I think there are many very good reasons for looking to the future of India with confidence and for deciding that now is a good time to invest in India but it is easy, if I may say so, for a politician to say that. More relevant is the fact that with me are a series of businessmen who are not only prepared to say that but at this moment they are prepared to commit themselves, their companies, their future and their money confident in the future of India. I believe they have made a wise judgement in doing that.