Prime Minister Narendra Modi and former UK PM Boris Johnson had targeted a trade deal by Diwali, however, there is little clarity on when it would be concluded. UK has told CNBC-TV18 that it won’t sacrifice quality for speed, and will only sign when there is a deal that meets both countries’ interests
Prime Minister Narendra Modi and former UK PM Boris Johnson had targeted a trade deal by Diwali, however, there is little clarity on when it would be concluded. UK Department of International Trade told CNBC-TV18, the two countries have a close and positive working relationship and a thriving trade partnership worth £24 billion in 2021.
“We continue to seek improvements to our current trading relationship. This is why we are negotiating a high-ambition Free Trade Agreement,” it said. It added that the quality of the deal won’t be sacrificed for speed, and the two parties will only sign when there is a deal that meets both countries’ interests.
The statement comes after a UK media report said that the India-UK free trade agreement (FTA) was on the "verge of collapse" after the Indian government was angered by comments made by UK Home Secretary Suella Braverman questioning action over visa overstayers from the country.
'The Times' quoted government sources to say that ministers in New Delhi were "shocked and disappointed" by the "disrespectful" remarks made by Braverman, who said she had concerns about an "open borders" offer to India as part of an FTA.
Another 'Politico' report claimed that any plans of a UK visit by PM Modi for Diwali to sign off on an FTA were now not likely to go ahead.
This follows the Indian-origin Home Secretary’s interview last week in which she said she feared a trade deal with India would increase migration to the UK when Indians already represented the largest group of visa overstayers.
"I have concerns about having an open borders migration policy with India because I don't think that's what people voted for with Brexit," Braverman told 'The Spectator' weekly news magazine.
CNBC-TV18 also discussed this with a panel of experts — David Lawrence research fellow at Chatham House, Rahul Chhabra, former secretary-economic relations at MEA and Jayant Dasgupta, former Indian Envoy to WTO.
Lawrence said that the UK-India trade deal has always been on the table and is a priority. He said the UK desperately needs work as the country has a major labour shortage and it also needs more trading partners as the country has cut off ties with with the EU partners after Brexit.
Lawrence said he was surprised by what the UK home secretary had to say. "The deal falling through in the next four weeks sounds too optimistic," he said, adding that even deals with Australia and New Zealand were slightly behind schedule.
He expects the trade deal to fall in place before the UK Parliament convenes next year.
Meanwhile, Chhabra said that India would require ease of access for students visiting the UK. He added that no issue between India and the UK pertaining to the trade deal is insurmountable.
Chhabra said that the UK Prime Minister Liz Truss has realised there are geopolitical compulsions on taking the UK-India trade deal forward and indications are rife that she wants to push for an early closure of the deal.
Dasgupta doesn't think data localisation is a significant issue between India and the UK. He said the UK doesn't have large data analytics firms like the US does. He also said that the environment and labour standards discussions could be of a more serious nature between India and the UK.