“We are the strongest supporters of civil nuclear energy for India”

In 2003, when Sir Michael Arthur was appointed as the British High Commissioner to Delhi, tension between India and Pakistan was quite palpable. A year ago, Western diplomats had left India fearing a conflict between the two nuclear warriors. Then things began to change. Sir Arthur was a witness to the thaw that swept South Asia and the growing warmth between India and United Kingdom.
Sir Arthur told Hardnews about how UK was backing US efforts to help India access civilian nuclear technology. He categorically states that Pakistan is a proliferating country and does not merit similar preferential treatment. Sir Arthur was very happy with the way the strategic alliance between the two countries was playing out on the ground.

Sanjay Kapoor Delhi

This is your first posting to Asia. How has it been?
It has been fantastic. For a British High Commissioner, India is a great place to be in. The last two-three years in India has been particularly nice. And I keep saying to London, that it is a continent and not a country. India is changing dynamically.

How do you quantify these changes?
The buzz of change is affecting economy, education, science, IT etc. India is the eighth largest investor in Britain as 500 Indian companies have a base in Britain. It is an enormous change from the situation that prevailed fifteen years ago. We are genuinely more multicultural now. The Indian Diaspora comprises 2 per cent of Britain’s population. There are as many Indians in Britain as there are Sikhs in India. NRIs are the most successful of all minorities residing in Britain and they control 4-5 percent of our GDP.

Even though it is about 60 years since India became independent from Great Britain, Indians have never nursed any hatred for its colonial rulers.  How do you explain this?

That is interesting. I think this has something to do with Gandhiji and the quality of the revolution that brought independence which was brought confrontation and peaceful, non-violent and peaceful that brought about its own legacy. I think India’s first generation led by Nehru did a fantastic job in putting itself together after independence. Britain did not have a traditional colonial kind of relationship with India that allowed build a relationship. Britain worked with India’s institutions. Now it has new “wind in the sail”. We are in a better relationship than before.
 

Well, after the 1998 nuclear tests, people who watched the Indo-UK relationship thought it had deteriorated considerably.

We are in a much better position than we were in 1998. Since Pokhran, there is much better level of understanding because of the economic dimension. We did disapprove of India become a nuclear weapon state there is no secret. Now we are to get around that problem to so from the civil nuclear side you join the world community. That is the big debate at the moment within the nuclear suppliers Group and Britain is trying for a successful

That is interesting. I think this has something to do with Gandhiji and the quality of the revolution that brought independence which was brought confrontation and peaceful, non-violent and peaceful that brought about its own legacy. I think

Do close ties with United States and its offer to give India civilian nuclear energy upset United Kingdom?
On the contrary we worked quite privately with your government and the United States government. We are very much involved in that process because we support the result, which seems like coming. We understand your need for civilian nuclear energy we want you to acquire it. We want the international community finds that. We want India to help in strengthen the NPT in the 21 century. This is a careful approach to your testing without undermining the NPT. There is strong support from us. However there is a debate about how we preserve the authority of the NPT.

Pakistan has demanded a similar deal in nuclear energy.
That is a different situation. We do not approve of proliferation and it looks as if proliferation has happened from Pakistan to other countries. We are not interested.

India has complex relationship with its neighbours. Your borders are not settled with China. Your relationship with Pakistan is the most sensitive. We are very careful to say that this would be settled bilaterally and we do not think the outside community has any role to play. The composite dialogue is moving forward. Surely, many would like to move faster forward.

Britain has contributed in providing a veneer of respectability and legitimacy to the US fight against terror, especially its attack against Saddam Hussain’s Iraq. A similar charade is being played out against Iran now. What are your views?

We went to war, not just because our American allies went but we genuinely believed in the problem of WMDs and we had ten years of Iraq not complying with the demands of the UN’s Security Council on its inspection of nuclear facility. They gave an impression that they were hiding something. With hindsight, we did not know enough. We strongly believed we went for the good.

Iran is a different ballpark. We strongly support Iran for developing civil nuclear technology. They are the members of the IAEA. We have no problems whatsoever. But we are apprehensive of the fact that they don’t misuse the technology to develop nuclear weapons. We don’t want them to become a nuclear weapon state and we are putting pressure.

Ten years ago, British telecom came to India to take advantage of the liberalisation in the telecom sector but it left shortly thereafter as it felt that there were manifest policy constraints. Does the British industry still experience similar problems?

We would like the reforms process to go further. It has come a long way from those ten years. Telecom is going places. Firms have invested greatly. Britain is the second biggest investor in India. But there are sectors where we would like faster liberalisation like insurance, banking, retail and accountancy. We would like things to speed up a bit.

High custom duties on scotch whiskey are a major irritant. This leads to smuggling of whiskey to India. What is the status of the scotch whiskey industry’s demands to bring down the duties?

We’ve been urging the Indian government to reform this area. There are huge proportions of people importing in the grey economy because the taxation is very high. There is accumulative tax in some states. It can be near to 500 per cent which is disproportionate. We’ve been urging that some tax be brought down because that way counterfeit will stop and revenues will go up.

Recent joint venture exercises in Goa between the two navies have interesting implications. How do you understand it and the question is that whether there is a scope of joint policing of the two navies of some sea lanes against sea piracy?

This is the biggest ever joint operation. In terms of navy to navy, it is a big change. India has more regional maritime capability and soon will be working with other naval powers. We would be genuinely delighted if India joins the proliferation security initiative (PSI).  

Nepal has been an area of concern for the UK as well. What are your views on the subject?

India has clearly more at stake. We have a lot of affection for Nepal as well as a huge amount of emotion. We want this crisis to come to end. We believe the right way forward is a political solution. The base ground is: the Maoists have to come out from violence and join the political process. They have to be part of a political solution and not a military solution. We want Nepal to keep a ceremonial monarchy. But it is very fragile, and all parties must play a game together. We cannot advise India on its role in Nepal. India is directly affected.

What about the economy?

One of the striking features of our links with India is the volume of people moving between the two countries. We issued 3 lakh visas all for the durations of 6 months to 10 years. We have over 20,000 students in Britain when we had only about 5,000 five years back. It is a step change in the quality of people to people interaction. The trade is faster and growing. It should grow to about 10 billion dollars soon. We just got to know recently that 60 per cent of all investments to Europe from India come to the UK. London is the place to go to rule the foreign markets.

What about the issue of outsourcing? Does it bother UK?
Concerning outsourcing, of course we don’t like losing jobs. But we recognise that you are competitive. We recognise globalisation. I think the area where India has great potential is agriculture. In 5-10 years India could be one of the major agricultural exporters. Britain has a lot of expertise in supply chain management, profit and loss and those special fields.

We went to war, not just because our American allies went but we genuinely believed in the problem of WMDs and we had ten years of We would like the reforms process to go further. It has come a long way from those ten years. Telecom is going places. Firms have invested greatly. We’ve been urging the Indian government to reform this area. There are huge proportions of people importing in the grey economy because the taxation is very high. There is accumulative tax in some states. It can be near to 500 per cent which is disproportionate. We’ve been urging that some tax be brought down because that way counterfeit will stop and revenues will go up. This is the biggest ever joint operation. In terms of navy to navy, it is a big change. Concerning outsourcing, of course we don’t like losing jobs. But we recognise that you are competitive. We recognise globalisation. I think the area where