Trade deal debate
WHILE families in the UK and India are getting ready for the big festival of lights, government teams from both countries are also working towards an important deadline – to get a proposed free trade agreement (FTA) over the line.
India recently became the fifthlargest economy in the world, behind the US, China, Japan and Germany, so it is clear why the UK is keen to get a trade deal in place. The Indian growth rate is predicted to be more than six per cent, while the UK may struggle to get past the projected 0.3 per cent mark.
The then prime minister Boris Johnson announced the Diwali deadline when he visited Delhi earlier this year, but some aspects of the agreement are yet to be firmed up, sources with knowledge of the negotiations said. Prior to taking charge as prime minister, Liz Truss visited India and held discussions with cabinet ministers there.
But back in London, the new home secretary appears to have put a spanner in Truss’s works with her outspoken comments on immigration. So polarising is the topic that immigration appears to evoke illegal migrants, rather than those who arrive in the UK through legal routes, integrate with communities and contribute to the economy here.
During her time, Theresa May wanted to include foreign students in immigration statistics even though most return to their home countries upon completion of their education. Business leaders – especially those in the hospitality industry – have been talking about labour shortages after Brexit and the pandemic. With Christmas just weeks away, retailers, hotels and restaurants are struggling to find the right staff.
India offers a massive market the British can sell their goods and services to – in addition to a large pool of English-speaking people. While the popular assumption is that India is protectionist about market access, those with an insight into bilateral talks said this was not accurate.
The UK is not among India’s top 10 trading partners, so Truss will be keen to get the deal passed to show both her party and the country that she was indeed the right choice to be the prime minister.