British industry is held back by "neo-colonial" attitudes to emerging superpowers such as India and China, according to a leading Midland industrialist.
Lord Bhattacharyya, founder of Warwick Manufacturing Group at the University of Warwick, said there was an assumption Europe would do "the clever stuff" such as research and design, while cheap labour would be employed to make products.
China and India were producing more graduates than the West, he said, and warned: "The world's economic centre of gravity has moved east."
Lord Bhattacharyya was speaking in a House of Lords debate on the world economy.
He said the only way to achieve continued success in Britain was through partnership with China and India.
"The old colonial days of trade following the flag have long gone."
He added: "The key word is partnership. This requires a far better understanding of these nations and markets than we have shown so far."
Britain's share of the Indian market was dwindling, he said.
"A couple of weeks ago I was addressing the Indian Institute of Technology at Kharagpur, which is my alma mater. I first went there 50 years ago.
"Today it is ranked in third place in the global league for technology universities. Tell its students that they can only do the manual work.
"Furthermore, what makes us think that we can do without a vibrant manufacturing sector?
"Manufacturing is still a major source of wealth creation and we have to make sure that we are up there with Sweden and Denmark spending money on research and development and innovation." ..SUPL: