Birmingham, the second largest city in the UK, could see a surge of inward FDI from India, thanks to its new direct air connection with Delhi and Amritsar, according to Marketing Birmingham, the city's promotional entity. The new route was launched by Air India at the beginning of August and is scheduled to operate four times a week.

According to Marketing Birmingham's estimates, in the past decade Indian companies invested $3.6bn into local economy and created or retained approximately 24,000 jobs in the West Midlands, the UK region in which Birmingham is located.

"Air India’s route is a significant step in helping us drive greater interest in the region and capitalise on the potential of this growing economy. Indian companies such as Jaguar Land Rover and Enzen Global are investing in multiple sites across the West Midlands, and the route will help these companies develop as well as attract new businesses here,” said Neil Rami, chief executive of Marketing Birmingham, shortly after the route was launched.

Between 2003 and 2013, India, with 16 new projects, was the fourth largest investor into the West Midlands and accounted for 28% of all FDI capital expenditure in the region according to fDi Markets, a greenfield cross-border investment monitor. Among the Indian companies that chose the West Midlands for their overseas expansion between 2003 and 2013, 43% invested in financial services and 31% in automotive original equipment manufacturing, fDi Markets database shows.

The route's importance lies also in the fact that according to 2011 UK census, Birmingham has the third largest Indian population in the country, after London and Manchester. It might also be instrumental in increasing passenger traffic at the Birmingham Airport which, with 8.9 million passengers served in 2012, still has not rebounded to the levels recorded between 2005 and 2009, when the airport served on average 9.3 million passengers annually.

“The widespread demand for direct flights between the West Midlands and India has enabled us to secure a frequent, fast service with the first scheduled Boeing Dreamliner service to be used at a UK airport outside London. Following the ambitious extension of Birmingham Airport’s runway, we hope to see other airlines joining Air India in committing to the West Midlands and introducing more direct routes to other corners of the globe,” said Paul Kehoe, CEO of Birmingham Airport.

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