UK's Conservatives plan for tax cuts to woo Indian investors

London, Aug 30 (UNI) Ahead of Tory leader David Cameron's visit to India next week where he will reportedly meet Prime Minister Manmohan Singh, the Conservatives are considering plans to cut a tax on the profits of small businesses to boost inward investment, particularly from India.

One of Cameron's policy groups has 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 the tax needed ''simplification or flattening'' to attract more investment in small and medium-sized enterprises (SMEs). The tax plans are one of a series of proposals made by Mr Redwood's group yesterday to encourage trade and investment links between India and the UK.

The policy group called on 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.

It 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.

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

The Conservatives also suggested that the Department of Trade and Industry spend more on the Indo-British Partnership Network, whose 100,000 pound budget is dwarfed by the 4 million pounds for the China-Britain Business Council.

Mr Redwood said: ''The Indian economy is growing rapidly.

We set out in this paper how UK business could be an important partner in India, in trade, investment and technology.'' ''UK-Indian links are strong. They should provide a firm foundation for many more profitable partnerships. We highlight the successes achieved so far, and urge others to go and see for themselves. India is now truly a land of opportunity. Hurry while the chances remain. Anglo-Indian business is now a two-way street that can profit both sides,'' he said.

UNI XC VJ ND1704