Trading with India: what the pundits think
May we intrude?
The main purpose of Theresa’s May’s visit to India this week was “to kick-start early talks on trade”, said Kiran Stacey and Jim Pickard in the FT. It looks like Britain will have its work cut out. Indians are “optimistic” about the possibility of a bilateral agreement with the UK – deeming it far easier to negotiate than India’s proposed deal with the EU, which is still “incomplete after nine years”. But there are big hurdles ahead, such as the vexed issue of the UK’S visa policy for Indians. Ministers in New Delhi also say they are “confused by the sort of relationship Britain wants with the EU”. Some, ahead of May’s trip, were equally flummoxed about the identity of the British PM. As Ram Madhav, a senior politician in the ruling BJP, wrote in The Indian Express: “A majority of us didn’t know a leader by the name of Theresa May existed.”
No quick win
A new deal with India would give UK companies more access to India’s 1.3 billion consumers, said the Trade Secretary, Liam Fox. But the main goal for Britain is the liberalisation of the services sector (a UK export strength), particularly finance and legal services. India’s refusal to open up is one reason why IndiaUK trade suffers. “You see the Germans and Italians easily exporting their engineering to India,” one former Tory MP told the FT. “It’s harder for us, given their restrictions on important service industries.” Yet the quid pro quo for India would almost certainly be a demand that Britain “loosen restrictions for Indians wanting to work or study in the UK”, said Jenny Gross in The Wall Street Journal. That still looks like “a key sticking point”.
Home Office gaffe
Indian business leaders made it clear before the visit that the single most important “open for business” sign that May could make would be to cut the £370 cost of a two-year visa to Britain to £87 – “the same rate as China gets”, said Alan Travis in The Guardian. Instead, the Home Office announced this week that Indian companies moving employees to the UK would face a higher salary threshold from November. Talk about “ham-fisted”.