London: A high-level gathering of business leaders from India and Britain presented a sector-wise wish-list to Manmohan Singh on Tuesday, but the Prime Minister steered clear of making any specific commitments on some of the more contentious issues involved.

India and Britain are the third largest foreign investors in each other's countries, and Indian foreign direct investment (FDI) in Britain has exceeded the reverse flow since 2004. Tuesday's U.K.-India Investment Summit — an initiative of the CII, FICCI and the Confederation of British Industry — was aimed at finding ways of boosting the investment relationship.

"The normal rule in government is that the higher you go, the less you know," Dr. Singh told the summit somewhat disarmingly when called upon to respond to the questions being raised. "So, you will forgive me if I can't answer all your questions."

"A big push"

Infrastructure was one area where there could be a big push, he said, with India in a position to absorb $320 billion worth of investment.

He acknowledged the importance of some issues raised by the CEOs in their deliberations — the lack of clarity about rules and regulatory processes, and the lengthy delays in approvals — but added that his Government was working hard to rectify the situation.

On the manufacturing front, where he said most barriers to FDI had been dismantled, the Prime Minister disagreed with the view that Chinese industry was a threat to its Indian counterpart. "I believe the world is large enough to accommodate the growth ambitions of India and China," he said.

"We are trying to engage China, and the volume of our trade is growing handsomely. I do agree that there are some worries about China, but they have to be taken on board in a constructive manner."

He said he was looking forward to his summit meeting with President Hu Jintao later this year.

"Already converted"

In response to a question on financial sector liberalisation — the Investment Summit working group made a strong pitch for capital account convertibility and further banking liberalisation — the Prime Minister told the CEOs that they were "talking to the converted."

"We remain committed to further liberalisation," he said. India needed to promote a widely held pension fund system, and have a "much larger insurance sector with a higher capital base."

At the same time, whenever enabling legislation was required to be passed by Parliament, the Government had to consult its coalition partners.

His own remarks emphasised India's adherence to "all international codes and regulations pertaining to safety and protection of investment and intellectual property." And in response to fears in a section of the British press about outsourcing in India leading to data theft, he said the country had a "well-designed system for data protection" but was "always willing to learn from our friends how to do things better."

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