Tories may woo Indian investors with tax cuts

Opposition Conservative party on Wednesday urged British universities to offer more scholarships and bursaries to Indian students and suggested a cut tax on profits of small businesses to boost inward investment particularly from India.

One of policy Groups of Party chief David Cameron, in a report, urged the party to review a 19 per cent tax rate imposed by Labour on small business dividends in 2004.

The Economic Competitiveness Policy Group, led by John Redwood, said that the tax needed "simplification or flattening" to attract more investment in small and medium-sized enterprises.

The report, released a week before Cameroon undertakes a visit to the subcontinent, called on the UK businesses to shed their "chronic aversion to risk in India" and to take advantage of the huge opportunity presented by its rapid economic expansion.

Urging the British universities to offer more scholarships and bursaries to Indian students, the report berated them for being "very slow to enter India", in contrast with American institutions, such as Harvard Business School, which have expanded there.

The report singled out telecoms as one sector in which experienced UK companies could build a strong presence in the country, and noted opportunities for manufacturing computing, biotech and retail firms.