Innovation the key to growth, says LKB

SECTORAL innovation is the key to the UK’s future economic success, Lord Kumar Bhattacharyya, head of Warwick Manufacturing Group, has argued.

“If we support sectoral innovation, we can pull supply chains to the UK. This will increase profits, employment and encourage foreign investment,” he told a House of Lords debate.

“If we think long term, we can build – without extra spending – an economy built on investment, not speculation, on sustainable value, not flash in the pan booms.”

Lord Bhattacharyya – generally credited with brokering the deal that saw Tata Motors’ take control of Jaguar Land Rover – said there are signs that a coalition for long-termism is emerging, but it is not yet there despite backing from Labour leader Ed Milliband and his team.

He warned that Britain risks becoming a nation of nervous shopkeepers and insecure bank clerks unless action is taken and argued that for decades business had been gripped by a consultancy and fast buck culture.

“This culture means you can’t get long-term financing,” he said.

“A focus on market leadership through innovation encourages sectors to work together to develop common expertise, from large firms to start-ups. It becomes self-sustaining – a positive loop of investment, innovation, leadership and new markets.”