May lays groundwork for post-Brexit India trade deal
India, Britain launch trade and investment talks
Prime Minister Theresa May said Britain would become the ultimate free trade champion as she laid the groundwork yesterday for a potential post-Brexit deal with India, the world’s fastest growing major economy.
In her first bilateral trip outside Europe since taking office in July, May said Britain would not “turn its back on the world” once it has left the EU but emphasized that new economic relationships had to benefit all sides. May’s visit is an attempt to get the ball rolling for a future trade deal between the two countries, although nothing can be signed until Britain actually leaves the European Union-most likely in 2019.
Accompanied by a delegation of around three dozen business leaders, May arrived in the smog-bound capital New Delhi late Sunday and will travel to the southern tech hub of Bangalore today.
“On this visit alone more than one billion pounds of business deals will be signed. And there’s much more we can do,” May told reporters after meeting with Indian Prime Minister Narendra Modi.
“We have also agreed to establish structural talks at officials level to identify what more we can do now before Britain leaves the EU to remove barriers to trade and investment.” While the benefits of a deal to Britain are evident, sealing one will be no easy task in a country which has been negotiating with the EU as a whole on a free trade agreement for the best part of a decade.
India still has a rigorous regime of tariffs and red tape which have traditionally made it one of the most complex places to do business, even if the potential market is huge. Britain’s need to cut deals quickly once it leaves the EU gives Modi’s government added bargaining power. The Hindustan Times wrote yesterday with Britain’s looming departure from the EU, “the UK needs trade with India more than ever”.
Despite their historical ties from the colonial era, bilateral trade is relatively low at $14 billion last year-smaller than the volume of trade between India and Germany. “India-UK ties are truly special. It is an enduring partnership, which is nurtured by our shared values, extensive people to people linkages,” Modi said, speaking at a joint press conference with May.
But May offered little ground on relaxing visa rules for Indian nationals a key issue pushed by Delhi-as she aims to keep a tight lid on the number of migrants entering Britain. Anger at levels of immigration from both inside and outside Europe were seen as a crucial factor in the outcome of the June referendum when British voters opted to pull out of the EU.
But there is particular unhappiness in Delhi over visa restrictions on students wanting to stay on in Britain after completing university courses which have led to a 50 percent drop in Indians enrolling. May announced two changes that will benefit Indian business travellers, while insisting that Britain’s current policies already ensure that “the brightest and the best of India’s students” continue to be welcomed. Indians travelling on work visas will be allowed to join the “registered travellers scheme”, which allows users to speed through immigration at some borders. The Indian government will be able to nominate top executives for the “Great Club”-a bespoke visa service for business travellers first launched in 2013. May said rules could be relaxed further if Indians who overstay their visas could be returned home more quickly.
“The UK will consider further improvements to our visa offer if, at the same time, we can step up the speed and volume of returns of Indians with no right to remain,” she said.
The governments also agreed a partnership to help India develop “smart cities”, which are designed to be models of urban planning-one of Modi’s pet projects.
NEW DELHI: India’s Prime Minister Narendra Modi (right) shakes hands with Britain’s Prime Minister Theresa May prior to a meeting in New Delhi yesterday. Prime Minister Theresa May said Britain would become the ultimate free trade champion as she laid the groundwork yesterday for a potential post-Brexit deal with India, the world’s fastest growing major economy.