Delhi Roadshow and UKIBC Meeting

Speech of Hon’ble Minister for Large & Medium Industries, Government of Karnataka at Indo-UK Business Convention, New Delhi, 11th September 2015

His Excellency
Sajid Javed, Secretary of State for Business Innovation & Skills
Francis Maude, Minister of State for Trade and Investment
James Bevan, British High Commissioner
Patricia Hewett, Chair of UKIBC
Members of UKIBC
Members of the British High Commission
Friends from print and electronic media
Ladies & Gentlemen

Let me begin by conveying my sincere gratitude to UKIBC for inviting me to speak at this very august gathering.

I am extremely happy to be here to share my perspectives on the UK-Karnataka bilateral relations, the success we have seen over the years and the great promise it holds as we look into the future.

India is not only the 2nd biggest Asian economy, it is also the world’s fastest growing major economy and by 2030, it will be the 3rd largest economy globally.

Even as most nations are going through a bleak period of growth, India’s GDP figures continue to impress the global business community.

The above numbers are heartening to note but what is more compelling is the opportunity to forge a strategic partnership. Dear friends, I stand here before you to speak about how Karnataka is THE STATE OF CHOICE - to make the vision of the Indo-UK strategic partnership a reality.

Indo-UK Trade
India and the UK have shared a historic past and our economies have been deeply entwined. In an increasingly multi-polar world order, the Indo-UK ties have evolved into a partnership of choice and leverage. Let me substantiate that by quoting a few numbers:
• Since the year 2000, FDI from UK to India totalled US$ 21 billion making UK the largest FDI contributor amongst G-20 nations.
• More than 550 UK firms are “Making in India”
• Similarly, the UK has been a popular destination for Indian investors.
• In fact India invests in the UK more than any other country in Europe.
• In 2014-2015 Indian investments in 122 FDI projects created 7,730 new jobs and safeguarded 1,620 jobs in UK.
• Tata is today one of the largest overseas manufacturing employment creator in the UK with about 45,000 jobs.

UK and Karnataka
The above numbers are heartening to note but what is more compelling is the opportunity to forge a strategic partnership. Dear friends, I stand here before you to speak about how Karnataka is THE STATE OF CHOICE - to make the vision of the Indo-UK strategic partnership a reality.
After assuming office for his first tenure, Prime Minister Mr. David Cameron visited Karnataka FIRST outside the National Capital. This goes to show how important Karnataka is for the Government of UK. Later, during his visit in 2013, the Prime Minister spoke of the “partnership of choice” with India and immediately proposed to jointly develop the Bengaluru-Mumbai Economic Corridor which will cut through the heart of Karnataka.
I have personally met the UK Minister for Trade and Investment in Bengaluru, and he aspires for a stronger, wider, deeper partnership with Karnataka. Let me assure you that nowhere else exists greater potential for such a partnership, than in Karnataka.
Karnataka is morphing into a centre of the hi-tech industry with multiple firms in 3D printing, robotics, semi-conductor chip design, nano technology and advanced materials. Most of the industries of the future are located here.
Bengaluru is the 2nd largest IT cluster in the world
• With over 10,000 companies
• 1.3 million employed in this industry
• Revenues of 50 Billion US$
• 375 R&D labs of MNCs
• Over 400 of the fortune 500 companies getting their IT done here…. and
• One of the largest tech centres globally
By 2020, Bengaluru is expected have about 2 million employed in IT sector, the largest collection of IT talent in the world.

Truly the future is being created in Karnataka!

Bengaluru is also the start-up capital with over 5000 start-ups:

• More than 35% of all start-ups in India
• Receives over 4 Billion US$ of VC funding annually
• Every year more than 1200 start-ups coming up in Bengaluru
In the transportation space, Bengaluru has become a leading logistics hub. Our Kempe Gowda International Airport currently handles 17 million passengers annually and is projected to go up to 25 million by 2020.
It has the 3rd highest air cargo traffic in India
Friends, the UK and Karnataka have a lot in common – from talent to technology to ‘being future ready’.
UK and Karnataka are natural partners in making the future happen.

Karnataka’s strengths

First - Existence of an industrial and technology based ecosystem
Karnataka is not only situated at the heart of South India – IT IS THE HEART OF SOUTH INDIA. It is where high end technology’s heart beats.
The best and the largest global companies have their R&D and Innovation centre’s located in Karnataka - across sectors – Aerospace, Defence, Information Technology, Bio Technology and Pharma.

The state has established industrial clusters and a thriving manufacturing base.
HAL, Airbus, Boeing, United Technologies Corporation, Mahindra and Dynamatic in the Aerospace Sector;

Toyota, Scania, Volvo, Honda in Automotive, engineering companies such as Toyota-Mitsubishi and scores of forging and machining companies have their base in Karnataka.

British companies such as Rolls Royce, GKN and BAE have substantial presence in the State and they are being joined by many SMEs from the UK in the near future.

In just the past one year, we have investment intentions from several British companies – all keen to set up manufacturing in different parts of the State.

If you talk of high technology, you don’t have to look beyond Karnataka!

Second - Highly Skilled Workforce
Karnataka has the best engineering and IT talent in the country. Karnataka is the first choice if you are looking for making and creating anything high end.
It is why British Companies such as ARM has its base in Karnataka – making microchips for the high end handheld devices like I-PADS and KINDLES.
It is why Tesco has its nerve centre located in Karnataka – controlling its stores around the globe. In fact the British High Commissioner has stated that when you go into a Tesco store in London, everything you don’t see is controlled from Bangalore: the temperature to movement of stock, so much so, I am told - even the fire brigade is called from Tesco in Bengaluru!
Companies such as British Engines, Cambridge Silicon, Zenith, Genisys Software are all hi- technology British Companies in Karnataka.
Financial services companies HSBC, AVIVA and Barclays and UK’s best life sciences companies GSK and Astra Zeneca are in Karnataka.
In fact, I was at Kolar day before yesterday at the ground breaking ceremony of GSKs brand new state of the art facility at Vemagal.
With so much of buzz around, it is no surprise that Karnataka is the “Start-up” hub of not only India but of Asia and this cuts across sectors.
Friends, Karnataka’s USP is not low cost labour anymore. These companies are not here because of low labour costs. The USP of Karnataka is a powerful combination of highly skilled workforce, great technical expertise, relentless innovation, a thriving ecosystem and huge scaleability.

Third - Physical infrastructure I am happy to share with you that the Government of Karnataka is investing in a big way in upgrading the state’s infrastructure to include tier 1 and tier 2 towns and backward regions.
We have in the pipeline some of the biggest infrastructure projects in the country – the Chennai Bengaluru Chitradurga Infrastructure Corridor, the National Investment Manufacturing Zones at Tumakur, Mysuru, Gouribidanur, Yadgir, Chamraja Nagara and Kalaburagi, numerous Tier-2 airports, highway projects and ports.
I would like to make a special mention of the Bengaluru-Mumbai Economic Corridor – where we hope to work very closely with the Government of UK in the near future. This will be a great opportunity for companies to create logistics, infrastructure, road & rail connectivity for Freight movement across South India.
There has been a lot of focus on Bengaluru. Our Government is committed to upgrading the infrastructure in the city to make it easier for you to conduct business. At the same time we are conscious of the fact that there is huge burden on the city.
We have therefore made special provision for encouraging investments in other districts, especially in northern Karnataka by developing more than 152 industrial areas spread across the State that match the natural resources and capabilities of the region aligned with the industry requirements.
I urge you to come to Karnataka and have a closer look at all the initiatives we are taking – I will assure you that you will not go back disappointed – like so many British companies have experienced in the past and continue to do so.

Fourth – Outstanding Social Infrastructure and a Cosmopolitan Culture

Karnataka’s education ecosystem – both primary and secondary - is already well known. The State boasts of the best schools and higher education institutions. It has the highest number of international schools and 2nd highest number of engineering and medical colleges in the country. Its healthcare facilities are second to none.
Besides, Bengaluru ranks as one of THE most cosmopolitan places in India with a wide choice for food & beverages. There will never be a dearth of places to go out – with family or with friends.
Karnataka has excellent weather all round the year with an equal share of sunshine, rain, summer and winter.
Karnataka has some of the best tourist destinations all within 4-5 hours of driving distance from one another. I can assure you that your weekends will never be dull. Chikmagalur, Coorg, Hampi, Mysore, Dandeli, Kabini, Jog Falls, the list goes on. Except snow we have everything else – from sandy beaches to beautiful mountains and reserve forests.

Fifth – Proactive State Government

Karnataka’s proactive approach to the subject of “Ease of doing business” is not recent. It was the first state in India to pioneer the Industries Facilitation Act way back in 2002. Incidentally, it was the same year the World Bank launched its ‘Doing Business’ report.
Over the last few years, the Government of Karnataka has been proactively working on several reform measures to ease the business environment.
The online portal—e-Udyami — was launched in April 2013. It enables investors to apply for project approvals and monitor them through ‘e-biz Karnataka’ in real time.
e-Udyami II –an upgraded version has been launched in January 2015 to fast-track clearances of projects by obtaining online approvals from 10 line departments.
E-biz Karnataka provides a comprehensive guide to investors for setting up industrial enterprises. At the same time, we are also working on bringing more departments and agencies under the Sakala services – a time bound approvals mechanism for various services - so that investors can get clearances within stipulated timelines.
Besides these initiatives, the Government of Karnataka has announced some major land related reforms to help investors acquire land within a reasonable time frame with full transparency.
Also I would like to mention that we have initiated major labour reforms so as to protect the interest of labour and yet make life easier for the Industry.
I am also happy to share with you that our Government has had detailed discussions with the British High Commission through a joint study done by PwC on “Ease of doing business in Karnataka”.
We are already working on these suggestions. Our endeavour has always been to listen to the views of the industry and do our best to act upon them in all sincerity. I call upon industry members to continue to be proactive in reaching out to us to get urgent issues resolved.
Easing regulations is a complex and important subject and I can assure you that the Government of Karnataka is committed to ensuring that we do everything possible to make Karnataka the easiest state to live, work and do business in.

Invest Karnataka 2015

Karnataka is gearing up for a mega investor summit, ‘Invest Karnataka 2015’, scheduled on 23rd, 24th & 25th November at Palace Grounds Bengaluru. I encourage industry members especially UK based companies to participate in this event in great numbers and make it a grand success.
We will be writing to the British High Commissioner inviting UK to be a partner country at the event and I am sure His Excellency, Sir James Bevan, will kindly accept our invite and provide his full support and encouragement.


To conclude, friends, I would like to say that the world has become a small global village.
The world has become competitive
Quality is the order of the day
Consumer satisfaction is the order of the day
In Karnataka, we believe in competition, quality and consumer satisfaction.

Our strengths are -
We are an industry friendly state
- the best state to do business
- Excellent human resources
- Excellent industrial relations
- Excellent Law and Order
- Strong and stable Government
- and, excellent weather all round
I am thankful to all the companies who have invested in Karnataka, and call upon others to come and invest in Karnataka.
Let us make use of the great platform of UK-Karnataka partnership to work more closely, and make the aspiration of the Indo-UK strategic partnership a reality!

Jai Hind! Jai Karnataka!

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