Rise of the ‘Brown Pound’: Indian entrepreneurship blossoms in the UK

Rise of the ‘Brown Pound’: Indian entrepreneurship blossoms in the UK

October 22, 2021 | Author: Kavita Bajeli-Datt, journalist for Indiaspora Features

They first came as laborers to work in British Rail, in the country’s factories and farms, and as hospital assistants, as it was hard to find locals for the subaltern work. Then, once they were a little settled, they showed their entrepreneurial zeal and spirit – particularly people from Gujarat who came from East Africa – to set up small retail, corner shops, garment, and wholesale businesses.

From that time to now, Indians in the UK – like in the US and many other parts of the world – have grown in numbers, stature, prosperity, and influence. Measured by any yardstick, the 1.5 million-strong Indian diaspora makes up one of the UK’s most prosperous, influential, and dynamic ethnic minority communities. Four from the community are among the top ministers in the UK government.

If the latest Sunday Times rich list indicates the standing of a community in British society, the Indian diaspora has a reason to bask in the sense of achievement. Four Indian businessmen have secured a place in the billionaires’ glittering hall of fame.

Mumbai-born brothers David and Simon Reuben led the chart as the second-richest in the UK with an estimated net worth of £21.465 billion. The brothers, who were nicknamed the “tsar brothers” after making a fortune during the restructuring of the aluminum industry in Russia, have since become major players in the UK property, internet, and investment markets and have been ranking among the top ten since 2006 in the UK rich list.

Industry and finance tycoons Hinduja brothers stood third with estimated earnings of £17 billion. Steel king Lakshmi Mittal has jumped from 19th to 5th place by adding £7.899 billion to their empire, and mining baron Anil Aggarwal stands at 15th place with £9 billion.

All of them, including more than ten others of Indian origin, have been credited by the Sunday Times with consolidating their wealth despite the pandemic gloom enveloping businesses across the globe.

Early settlers

Indians began to immigrate to the UK in the 18th and 19th centuries as crews on ships. After World War II, Indian elites came to Britain in significant numbers for education and job opportunities. The next wave of immigration started in the 1960s and 70s when persecuted Indians from East African countries like Kenya, Uganda, and Tanzania immigrated in large numbers to Britain. They quickly regrouped and helped each other become prosperous.

The last wave of immigration was in the 1990s when many young, highly-educated Indian professionals explored Britain for opportunities. The skilled Indians in IT, healthcare, and telecommunications and the second-and-third generation of migrant entrepreneurs have today become the face of the Indian diaspora, which forms over 2.5 percent of the UK’s population of 66 million.

It’s no wonder that in 2003, Anjna Raheja, founder of specialist marketing group Media Moguls, which specializes in targeting South Asian consumers, coined the term ‘Brown Pound’ to describe the growing economic power and disposable income of the Indian community, which was till then identified by their ‘brown’ color. The term helped in shedding the negative image of the Indian community and highlighted their core strengths like hard work, ambition, aspiration, and strong family values.

These qualities helped them play an essential contribution to the UK economy. Today, they are considered a sizable ethnic community wooed by the political classes to win elections.

The growing political clout of the Indians diaspora could be seen when in 2015, around 60 candidates of Indian origin were in the fray, making it the highest number so far in the UK elections, with a record 10 Indian-origin candidates elected into the House of Commons. During the 2015 elections, the Conservative Party campaign saw the first-ever campaign song in Hindi.

Conservative Party’s Rishi Sunak, the son-in-law of Infosys co-founder Narayana Murthy, born in Southampton to Punjabi Hindu parents, has been the Chancellor of the Exchequer since 2020. His father was a general practitioner, and his mother, a pharmacist, emigrated from East Africa.

Priti Patel, born to Hindu parents who emigrated from Uganda and had run a convenience store there, is a prominent British politician. She has been a Home Secretary since 2019 and had previously served as Secretary of State for International Development from 2016 to 2017. The other two Indian-origin ministers who hold top positions in the Prime Minister Boris Johnson cabinet are Agra-born Alok Sharma, Secretary of State for Business, Energy and Industrial Strategy, and Suella Braverman, of Goan roots, who is the Attorney General.

What validated and solidified further the economic and political clout of the Indian diaspora was when Indian Prime Minister Narendra Modi visited the UK in 2015 and was given a “rock star reception.” Around 60,000 members of the Indian diaspora converged on the Wembley Stadium to welcome Modi, which the Guardian newspaper described at that time as “the largest and arguably the most spectacular welcome any foreign leader has ever received in Britain.” Modi described the UK’s Indian diaspora community as a “living bridge” between the two countries.

The emergence

The valuable contributions of the enterprising and entrepreneurial spirit of the Indian diaspora could be seen in academia, literature, arts, medicines, science, and sports. Many reports have also shown that the Indian diaspora is engaged in high employment and professional qualifications. The numbers presented by consultant Grant Thornton in collaboration with the Indian High Commission and the Federation of Indian Chambers of Commerce and Industry, a non-governmental trade association and advocacy group based in India, in their 2020 report ‘India in the UK: The Diaspora Effect’ captures the extent of the Indian contribution to the UK economy.

The number of Indian-owned businesses with at least 100,000-pound turnover stands at a staggering 654. Indian companies collectively generate £36.84 billion, employ 174,000 people, pay one billion in corporate tax, and invest around 2 billion pounds through capital expenditure.

Grant Thornton’s latest tracker for 2021 has said that 850 Indian companies are operating in the UK, with a £50.8 billion turnover, employ 116,046 people, and pay £459 million in corporation tax. The tracker found that Indian companies were involved in 10 acquisitions (the highest of any single EU country) throughout the year, including four in the technology and telecom industry and two in manufacturing.

Hospitality, healthcare, pharmaceuticals, retail, real estate, construction, and food and beverage have a robust Indian presence though the community’s business interests are spread across sectors.

This success means some Indian diaspora business leaders are among the wealthiest people in the UK. Apart from the Hindujas and Mittal, other high-profile Indian business names in the UK include Lord Karan Bilimoria, founder of Cobra Beer, and Kartar and Tej Lalvani, Chairman and CEO of the UK’s largest vitamin company, Vitabiotics.

According to Ashis Ray, the longest-serving Indian foreign correspondent in London and President of the Indian Journalists’ Association (Europe), “Indian and Indian origin businessmen have undoubtedly done very well in the ease-of-doing-business environment of Britain.

“They are likely to continue to increase their footprint in the UK’s economy. The latest success story is the Issa brothers, who bought the supermarket chain Asda from Walmart. But exporters among the businessmen are facing the crunch of the UK no longer being a part of the EU single market,” Ray told Indiaspora.

The Issa brothers – Mohsin, 49, and his brother Zuber, 48 – founded Euro Garages, a chain of petrol filling stations in the United Kingdom and Europe. The company was founded in 2001 following a single petrol station in Bury, Manchester, which cost £150,000. The Issa brothers employ over 44,000 people across more than 6,000 sites across Europe, the US, and Australia. Last year, the brothers, whose parents moved to the UK from Gujarat in the 1970s, pulled off an acquisition bigger than the Tatas when they successfully bid for the British supermarket chain Asda from US owners Walmart as part of the strategy to expand their non-fuel business. In April this year, they acquired a popular British fast-food chain, Leon, as part of what they described as their goal to grow their foodservice operations in Britain.

Second generation

Though the top names of the Indian diaspora are much talked about in the media for their acquisitions and expansions, what is not known is those small businesses located mainly in London and other cities supported local communities when they opened their kitchens, shops, etc. takeaway food outlets during the COVID-19. It is essentially their humanitarian efforts that the ethnic Indian society has showcased their entrepreneurial spirit.

The next generation of Britons of Indian heritage has taken up the baton apart from the first-generation business leaders. Many of them are contributing immensely, primarily through their fintech, MedTech, and Edtech start-ups. Notable among them is Indian-origin entrepreneur Rishi Khosla’s start-up OakNorth, a scale-up business lender that uses an artificial intelligence model to provide loans for small and medium-sized companies to grow their businesses. In 2019, his company brought $440 million into London, making it the third-largest fintech investment deal in Europe after Berlin and Stockholm.

Undoubtedly, the Indian diaspora in the UK – once stereotyped as Heathrow sanitation workers, British Rail menial laborers, and restaurant dishwashers – has worked hard to become a formidable force and community to be reckoned with as they combine their eastern cultural heritage, family values, and work ethics with their education from top UK and US educational institutions to make them one of the cornerstones of British society.

This article is part of a new series, Indiaspora Features, which commissions journalists to write about topics of interest for the global Indian diaspora.

Kavita Bajeli-Datt is an independent journalist associated with South Asia Monitor. She has worked in prominent Indian news organizations like IANS, PTI, and The Week where she wrote extensively on health, crime, politics, and art and culture.