There is optimism that a deal could be achieved within the coming months, but significant challenges, often referred to as the “big nuts to crack,” still need to be addressed
The trade negotiations between the UK and India have reached a crucial and complex final stage. The UK’s Trade Secretary, Kemi Badenoch, is expected to attend a G20 trade ministers meeting in India this week, but a comprehensive trade deal is not anticipated to be finalized by that time.
There is optimism that a deal could be achieved within the coming months, but significant challenges, often referred to as the “big nuts to crack,” still need to be addressed.
The UK government has considered a trade deal with India a highly desirable outcome of its post-Brexit trade efforts. The goal is to reduce tariffs on key UK exports like cars and whisky, which face substantial import taxes in India, hampering their competitiveness due to higher prices.
The negotiations’ timeline has faced setbacks, with a missed deadline of securing an agreement by Diwali in 2022, as initially pledged by former Prime Minister Boris Johnson.
One of the sticking points in the negotiations has been the UK’s reluctance to grant more visas to Indian workers, which has caused friction and raised doubts about the UK’s commitment to strengthening economic ties with India.
Criticism has come from the Labour party’s shadow international trade secretary, Nick Thomas-Symonds, who pointed out past failures to deliver favorable trade agreements. Promised deals with India and the United States by the end of 2022 were not fulfilled, contributing to a pattern of unmet expectations.
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A spokesperson from the UK’s department for business and trade emphasized the commitment of both countries to achieving a mutually beneficial deal
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While details of ongoing negotiations cannot be disclosed, the spokesperson reaffirmed that the UK will only finalize a deal that is fair, balanced, and aligned with the best interests of the British people and the economy
While Badenoch’s visit to India is mainly for the G20 trade ministers meeting and not formal negotiations, discussions between officials from both sides are expected to continue. She is scheduled to meet her Indian counterpart for one-on-one discussions after the G20 gathering.
Apart from government-level talks, Badenoch will engage with the B20, a business-focused entity similar to the G20. This forum, chaired by Indian conglomerate Tata, has announced substantial investment plans for a gigafactory in Somerset, UK, totaling over £4 billion.
The UK’s strategy involves actively encouraging Indian investors to participate in the British market. While there are reports suggesting a trade deal might be nearing completion and could coincide with Rishi Sunak’s visit to the G20 leaders’ summit in September, officials downplay the likelihood of a comprehensive deal by that time.
Government sources indicate that recent negotiation rounds have “closed some chapters,” but acknowledge that upcoming phases are expected to be even more challenging. A spokesperson from the UK’s department for business and trade emphasized the commitment of both countries to achieving a mutually beneficial deal. While details of ongoing negotiations cannot be disclosed, the spokesperson reaffirmed that the UK will only finalize a deal that is fair, balanced, and aligned with the best interests of the British people and the economy.
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