Trade between India and the UK remains quite limited. India accounts for just 2% of total UK imports against China at 7%. This is despite the strong historical and cultural links between the two countries and India’s status as the UK's most important trading partner within the Commonwealth, accounting for nearly a quarter of Commonwealth imports.
Dr Sunil Mitra Kumar, Lecturer in Economics at the King’s India Institute and Dr Kamini Gupta, Lecturer in International Business and Comparative Management in King’s Business School have been awarded a major new research grant by the UK Economic and Social Research Council (ESRC) and Indian Council of Social Science Research (ICSSR) to study the future enablers and obstacles for UK-India trade.
This three-year project is led by King's College London in collaboration with Dr Prateek Raj at the Indian Institute of Management Bangalore. It has been co-designed with non-academic partner the Federation of Indian Chambers of Commerce and Industry (FICCI).
The new grant, entitled Enablers and Obstacles for UK-India Trade: Banks and Diasporas will investigate two consequential aspects of India-UK trade.
The project will investigate the role of credit in supporting export-oriented small Indian manufacturers, and the role of UK-India diasporic networks in shaping supply chains and trade. Small manufacturing firms provide significant employment and have shown consistent growth, yet what drives their propensity to export and in particular the role of bank credit is not well understood.
Similarly, while diasporic networks can strengthen trade links and mitigate inefficient policy, there is a lack of representative and current data as to how they form, function and shape trade links. Doing so, we intend to deepen understanding of phenomena whose significance is widely recognised yet for whom empirical data are lacking.
Commenting on the new grant, Louise Tillin, Director of King’s India Institute said:
We are delighted to be hosting this research project on a theme of critical importance to both the UK and India. In a situation of global economic uncertainty exacerbated by the Covid-19 pandemic, and with Brexit on the horizon, it is crucial to understand the drivers and barriers to enhanced trade relations. This project will enable the generation of primary data on areas such as the role of diasporic networks and the constraints on SMEs as exporters which are recognised as important for trading relations but on which little data and in-depth analysis exists.– Dr Louise Tillin, Director of the King's India Institute