BETTER FUTURE Embassy: UK-India Design Trade Expansion

Briefing Document: BETTER FUTURE Embassy Initiative and UK-India Trade Landscape Date: 26th November 2024 Subject: Overview of BETTER FUTURE Embassy's global trade initiative, with a particular focus on the burgeoning UK-India design and architectural services market. Executive Summary BETTER FUTURE is launching a global trade development initiative, "BETTER FUTURE Embassy," to connect design and architectural studios with international business opportunities. This initiative comes at a time when local market design projects are "softer than pre-COVID conditions," while "global emerging markets have been booming." The inaugural Embassy event will take place at the London Design Festival on 18th September 2025, co-located with Material Matters. A significant focus will be on the Indian market, which is projected to become the world's third-largest economy by 2030 and offers substantial growth for UK creative exports. The UK-India Free Trade Agreement (FTA) is identified as a significant catalyst, streamlining market entry, reducing costs, and enhancing intellectual property protection. Key Themes and Important Ideas/Facts 1. The "BETTER FUTURE Embassy" Initiative • Objective: To connect Studio Partners (design and architectural firms) to global trade opportunities, particularly in emerging markets where demand for expert services is growing. • Launch and Duration: Launches at the London Design Festival on 18th September 2025. It will be a year-long program involving "contact with over 100 London-based foreign trade missions." • Target Audience: Roles associated with new markets or business development within design and architecture studios. • Services Offered: Networking, introductions, and facilitation for the establishment of global design services. • Event Format: The inaugural event is a half-day forum (09:00-13:00) split into three sections: ◦ Building and promoting multinational creative business. ◦ Pushing at open doors for creative studios. ◦ Conversations and connections (networking lunch). • Key Speakers: Include Mark Bergin (Founder & Chair, BETTER FUTURE Awards), Chris Heyes (Commercial Director, UK India Business Council), Christine Losecaat MBE (Founder, Little Dipper International), Kirsty Dias (Managing Director, Priestman Goode), Mark Hannant (Co-founder, IndigoCPO), and Deborah Dawton (Chief Executive, Design Business Association). • Partnership: Staged in partnership with the Design Business Association (DBA). • Context: "Over the next 25 years, the world population is forecast to grow by 1.7 billion people. Driving significant growth for design and architectural services." 2. Global Market Opportunity for Design Services • Shifting Landscape: Local design markets have been "softer than pre-COVID conditions," while "global emerging markets have been booming." This creates an "opportunity for the magic of the market to occur - a growing demand for expert services matched with the world-leading design studios." • Growth Regions: "88% of future global growth occurring in Africa, Asia, and the Middle East, delivering global design businesses significant growth and revenue." These regions are projected to experience "significant and sustained economic growth" due to large working-age populations and potential for economic convergence. • "Dark Studios": The Design Business Association (DBA) reports "70-100% export growth for their exporting member with many design studio effectively being dark studios for the UK market," meaning they are "Based in the UK with 90%+ of the studio output being export." This is identified as "an evolving trend for market focused studios finding new markets and economic conditions." • Adaptation: "Adaption is the name of the game. Service businesses that hunt for opportunities in global markets are delivering greater returns for shareholders and underpinning key export revenue for the UK economy." 3. Focus on India: A Key Growth Market • Economic Outlook: India is "poised to be the world's third largest economy by 2030," driven by its rapidly expanding economy (65% of UK firms cited this as a driver) and vast consumer base (60%). • UK Business Interest: ◦ "72% of UK firms identified India as a key market for international growth, up from 61% last year." ◦ "73% plan to establish operations," with "13% targeting the next 12 months and 29% within two years." ◦ "96% plan to scale up their India operations, with 52% aiming to do so within the next year" for firms already present. ◦ Currently, "667 UK-headquartered firms operating in India, generating £47.5 billion in revenue and employing over 516,000 people." • Drivers of Attractiveness: ◦ Rapidly expanding economy (65%). ◦ Vast consumer base (60%). ◦ Talent access, "India’s large, skilled workforce, particularly in sectors like technology, consulting, and professional services" (53%). ◦ Digital competitiveness (47%). ◦ Improving ease of doing business (45%). ◦ Cost advantages (39%) are still relevant but secondary to innovation and a business-friendly environment. • Indian Business Interest in UK: "89% of Indian businesses recognise the UK as a focus market for business expansion." "99% plan to expand" their UK presence, and "nearly 90% express a desire to establish a base" if not already present. 4. Impact of the UK-India Free Trade Agreement (FTA) • Catalyst for Engagement: "Around 75% of UK firms surveyed indicated that the FTA will encourage them to explore additional opportunities in India." • Key Benefits of the FTA: ◦ "Easier market access and fewer trade barriers in India" (50%). ◦ "Tariff reductions and cost savings" (40%). ◦ "Improved ease of movement for professionals and the workforce" (35%). ◦ "Stronger intellectual property protections" (30%). ◦ "Streamlined regulatory approvals" (25%). • Broader Collaboration: The FTA "goes beyond trade in goods and services" to "promote collaboration in innovation, sustainability, and digital governance." • Business Confidence: "A strong 79% of UK businesses surveyed agreed that FTAs play a key role in driving investment and supporting business growth." "21% of UK businesses surveyed said they have no concerns about the FTA and view it as wholly beneficial." 5. Challenges and Mitigation • Barriers for UK firms in India: ◦ "Regulation and forex controls: 63%." ◦ "Infrastructure gaps: 38%." ◦ "Fragmented market: 38%." ◦ "Success will come to businesses that combine ambition with local insight and a commitment to long-term partnerships." • Barriers for Indian firms in the UK: ◦ "Tariffs and protectionist policies: 100%." ◦ "Fragmented regulatory landscape: 100%." ◦ "Infrastructure gaps: 50%." ◦ "The UK is a high-cost, high-reward market and success requires preparation, patience, and a willingness to adapt." - Yogesh Chaudhary, Director, Jaipur Rugs. • Shifting Mindset: While challenges persist, they are "no longer seen as deal-breakers." Businesses increasingly view them as "manageable risks requiring the right strategy, local partnerships, and expert support." • BETTER FUTURE Embassy's Role: Provides "practical and insightful information, contacts and routes to new markets," including "expert presentations, project spotlights and market overviews alongside practical advice on how studios can develop international trade strategies." • DBA's Role: "strengthening ties with the UK Government to support international growth—and how members can benefit from these initiatives." Conclusion The BETTER FUTURE Embassy initiative is strategically timed to leverage significant global growth opportunities in design and architectural services, particularly in the rapidly expanding economies of Africa, Asia, and the Middle East. India stands out as a critical market for UK firms, with the UK-India FTA acting as a powerful accelerant. While regulatory and market complexities exist, the prevailing sentiment is one of optimism and a willingness to adapt, making targeted initiatives like BETTER FUTURE Embassy vital for enabling UK design studios to successfully engage in this booming global trade landscape.