The Indian government is responsive to concerns expressed by businesses but needs to do more to attract investments into sectors such as e-commerce, the UK India Business Council (UKIBC) has said.

The comments from the lobby grouping come after there was a sharp criticism of Goyal for saying Amazon was not doing India a favour by the investment announcement. India's GDP growth is set to slow to a decadal low of 5 per cent for 2019-20 and all eyes are set on the strategy deployed by the government in the upcoming Budget.

Amazon CEO Jeff Bezos has said the e-commerce major will invest USD 1 billion (over Rs 7,000 crore) in digitising small and medium businesses in India.

Declining to comment specifically on the impact on investors because of Goyal's comments, UKIBC chief executive officer Richard Heald told PTI in Mumbai that the e-commerce sector has a tremendous potential, especially for the smaller businesses, who get a platform to sell their wares.

'I am a great fan of e-commerce and I think that e-commerce is misunderstood to a certain extent and it benefits the general public and those people who operate within the supply chain in ways that are not popularly understood,' he said.

Heald said Mukesh Ambani-promoted RIL also has plans to enter the e-commerce segment through a different business model and one can have her own preferences on business models.

'Encouraging investments into India is important, encouraging the e-commerce sector is important because it benefits small businesses disproportionately to large businesses,' he said adding that British businesses may not be 'startled' at the posturing.

India represents a large opportunity for the British businesses and even a slower 4.8 per cent GDP growth is much faster than what the UK or Europe is witnessing, he said.

When asked if the government is responsive in India, he answered in the affirmative and said, 'What I found striking (in conversations with government officials) was that increasingly, it is a two-way dialogue. The Indian government wants to understand and engage, it wants to understand what the operating issues are and get those addressed, positives as well as negatives.'

Welcoming the cut in corporate taxes, Heald advocated a relaxation in fiscal deficit targets in the upcoming Budget and added that the UKIBC will keenly watch the narrative on growth being set by the Indian government and look for specific measures on rural poverty alleviation and infrastructure spends.

When asked about social sector troubles experienced in India, which have made billionaire George Soros to speak out at Davos last week, Heald said the UKIBC members will not be too perturbed by those concerns.

He reasoned that commercial success is the most important aspect for a business when it makes a call to investment and not other 'optics'.

'From the business point of view, I am not going to say it (social issues) is not relevant, but not high up the list,' he said.

When asked if there is over-pessimism about India, he initially said it would be 'presumptuous' to say so.

'I have huge admiration for India. Since 1947, you have survived and prospered as a country which is secular, is diverse. Your history is extraordinary. Clearly, there is something there that you have to foster and you have to develop,' he said.