Indian ambassador: Putting a premium on democracies for invstment – Delano

Santosh Jha has been the ambassador to Belgium, the EU and Luxembourg since last summer, but because of covid restrictions did not have a chance to formally present his letters of credence before 20 January. He has previously served at missions in Moscow, New York and Colombo and prior to his appointment to Brussels was the ambassador to Uzbekistan.

Duncan Roberts: Indian-EU trade is growing in importance for both sides. Will recent developments such as Brexit or the EU-China Investment Deal have any impact on that relationship?

Santosh Jha: I don’t think we should look at it from a third country perspective. The EU was India’s largest trading partner when United Kingdom was part of it, so its exit takes away a little bit of that crown, in a sense…the United States has regained that position. In fact, it had regained its position even with Britain [in the EU], because US-India trade has grown. But it remains the second largest trading partner and is still India’s second largest export market after the United States. The EU is also India’s largest investment partner, I think the total investment portfolio has exceeded $80 billion since 2000. And in fact, Luxembourg is the sixth largest investor from the EU, and its investment has grown in the last three to four years, quite significantly.

And then the EU is the source of principal source of technology and best practices. India’s Competition Commission has taken a lot of inspiration from the EU system. We are in the process of passing data protection law in India which is based on GDPR, not entirely identical, but very, very similar.

So, I don’t want to speculate on what is the impact of Brexit, because frankly speaking I don’t see any negative impact as far as we are concerned. There could even be a positive impact in the sense that there is one less [member state] to negotiate with…

And then you have the China EU relationship, which stands up on its own. Ours is a different relationship, between democracies and between systems which are very similar in terms of values and principles. We are an open market economy. We do not discriminate between foreign investment and Indian investment, in that sense. And that is shown in the huge spike in investments from around the world over the last six years under prime minister Modi. Even in the covid year there has been an almost 100% jump in investments coming in on the basis of the prospects for the Indian economy in 2021, which a British think tank has just yesterday [18 January] projected would grow 9%.

India has the biggest young workforce in the world, so future generations are coming through…

Yes, India produces a very large number of highly qualified people. And the best reflection is the Indians working in Europe. If you look at the quality of professionals that we are sending across to Europe, to Japan, to the United States…they contribute to the competitiveness of the economy, wherever they are. And because they come from democratic societies which are diverse, pluralistic, they adjust to a foreign country very readily. You will hardly find Indians disturbing the social fabric of a foreign country.

Indian ambassador Santosh Jha (left) receives a book on Luxembourg castles as a welcome gift from Selvaraj Alagumalai, president of the Indian Association Luxembourg. Photo: Matic Zorman

There has also been talk of increased cooperation in the area of sustainable development. What other areas might be up for discussion at the EU-India summit in Porto in May?

We haven’t formally announced [the summit] yet. But it is interesting that you’re raising sustainable development. India was one of the critical countries that allowed the Paris climate change agreement to happen. Prime minister Modi, along with the French president, launched the International Solar Alliance, which now has 89 signatories. We have just last week opened it to all UN members and invited Belgium and Luxembourg to join. The European Union is already a part of it. If you look at the last five years, India’s performance has been absolutely exemplary. Climate Action Tracker, which audits climate performances, says that India is top of class [it is one of the few countries that is “2oC compatible”].

Today, India produces 136 gigawatts of electricity through renewables, which is 36% of its capacity. We have a target of achieving 40% by 2030. We had a target to produce 175 gigawatts by 2022, and we are so confident that in December 2020 we revised that target to 220.

If you look at the Prime Minister’s flagship initiatives, cleaning reverse, cleaning cities, urban rejuvenation…there is a scheme to shifting to electric and hybrid vehicles. India ran the largest LED street lighting and house lighting programme, which has led to massive concentrations of energy. We are running a campaign to plant 2.5 billion trees by 2030, and we might actually plant double the number, even as Amazon is being depleted. All this is not covered in the EU press, unfortunately.

India is also becoming increasingly important to Luxembourg as a partner in the financial services sector. We have seen this in the recent Lux Stock Exchange cooperation agreements with the State Bank of India and the India International Exchange Limited. How does India see Luxembourg in terms of financial services opportunities?

When you look at Luxembourg, the financial sector naturally comes to mind. There is a fintech revolution happening in India, and Luxembourg, being a leader in that, is a natural partner. Beyond that, looking at green bonds, Luxembourg is a pioneer. So, through these agreements that you were referring to, at some point the Indian banks will be approaching concrete steps in this direction.

The potential is enormous. India has announced an investment of $1.5 trillion over the next five years for infrastructure. And in order for that to be implemented, a lot of money will have to be raised. Infrastructure will be naturally green, because that is the emphasis in everything that we do. And therefore, Luxembourg can play a role.

There are also Luxembourg companies that are working on sustainable development projects in India. Boson Energy is working with the water partnership.

The most recent example of India-Luxembourg cooperation, which came out of the virtual summit between prime ministers Modi and Bettel on 19 November is the B Medical Systems agreement. We put them on a plane within 10 days of the prime ministers’ meeting. And they are now already invested in India. They did not get a red carpet, they got a bright red carpet… which was endless. You know, it just kept on growing as they expanded their own ambition. We promised them that on the first day when I spoke to the CEO on 20 November, and we fulfilled it.

So, you think that sort of word of mouth communication will get around…

Frankly, investment happens from word of mouth. I believe that people invest because there is a good feel about a place, that you have a sense that it is growing, that you can make money there… And, look, whoever has gone to India has made money.

We have protections for intellectual property, which are of high standard, we produce intellectual property ourselves and want to protect it.

And perhaps now the time has come where you start putting premium on democracies, where you can say that, look, I’m not only going to invest because somebody is opening up his arms…the embrace could be lethal as well, at times. So, you know, a trustworthy partner, a democratic open market, open economy, open polity, open society, free judiciary, free media–all this is very similar value systems that you operate here. So, you don’t have to adapt massively. Of course, there is a cultural adaptation to be made; India’s a different country. But I think increasingly, that should be the way forward.

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