Published — Tuesday 19 February 2013
Last update 18 February 2013 10:52 pm
MUMBAI: British Prime Minister David Cameron flew into India yesterday promising to try to revive Indian interest in the Eurofighter even though New Delhi has chosen a French-made rival and as a graft scandal is engulfing an Anglo-Italian helicopter deal.
Cameron said the two countries enjoy a “special relationship,” a term usually reserved for Britain’s ties with the United States, but it is a relationship undergoing profound change. For now, Britain’s economy is the sixth largest in the world and India’s the 10th. But India is forecast to overtake its old colonial master in the decades ahead. In a nod to how the relationship is evolving, Britain will stop giving India aid after 2015.
Making his second visit to India as prime minister, Cameron’s trip comes days after a similar trade mission by French President Francois Hollande, underlining how Europe’s debt-stricken states are competing to tap into one of the world’s fastest-growing economies.
Cameron’s delegation, which includes representatives of more than 100 companies, is the biggest taken abroad by a British premier and includes four ministers and nine MPs.
But the timing of the trip is not ideal. India said on Friday it wanted to cancel a $ 750 million deal for a dozen helicopters made by AgustaWestland, the Anglo-Italian subsidiary of Italy’s Finmeccanica, over bribery claims.
That will not make Cameron’s job of persuading India to buy more civil and military hardware easier, and Indian officials have told the local press they intend to press Cameron for “a fully-fledged report” on what Britain knows about the scandal.
Britain has said it wants to wait until the end of the Italian investigation before commenting in full, but has given India an interim report on the subject. “This is something for the Italian and Indian authorities to deal with and I’m sure they will,” Cameron told reporters yesterday, saying issues had been raised that needed to be settled.
Meanwhile, India's Prime Minister Manmohan Singh said yesterday the government had nothing to hide in the $ 750 million deal for AgustaWestland helicopters. The ministry has asked AgustaWestland to show by Friday that no bribes were paid in the deal and says it is ready to cancel the purchase outright. The helicopter company says it will comply with the request. In his first comments on the affair since Italian police arrested Finmeccanica head Giuseppe Orsi last week, Singh said the government wanted to debate the issue in parliament, which begins a new session tomorrow.
"Parliament is the appropriate forum to discuss all issues raised by the opposition. We are ready for any discussion," Singh told reporters. "We have nothing to hide."
The furore over the helicopter deal follows a string of graft cases that have buffeted Singh's government, which is nearing the end of a second five-year term and faces elections due in early 2014. The opposition is expected to raise the issue once parliament opens.
Cameron said he would tell the Indian government that the Eurofighter jet, which is partly built in Britain, remains an attractive option if India decides to review a multi-billion dollar deal to buy 126 French-made Rafale fighters. New Delhi rejected the Eurofighter last year.
Cameron told his hosts they should open up their economy because Britain had done the same for Indian firms. He said he was proud of the fact that Indian companies like Tata group, the owner Jaguar Land Rover, had such a strong foothold in the British economy, but said he expected a reciprocal arrangement.
“Britain is an open economy and we encourage that investment,” he said. “I think, in return, we should be having a conversation about opening up the Indian economy, making it easier to do business here, allowing insurance and banking companies to do more foreign direct investment.”
India still had outdated rules and regulations, Cameron complained.
Cameron’s visit to India, which won independence from Britain in 1947 and whose colonial history remains a sensitive subject for many Indians, will take in Mumbai and New Delhi.
His office said business deals that will be announced during the trip would create 500 British jobs and safeguard a further 2,000.