The renewed parameters of the India-United Kingdom free trade agreement negotiations are set to be defined, as UK Foreign Secretary David Lammy is expected in India this week, marking the first high-profile visit under the newly elected UK Labour government.
The free trade agreement (FTA) talks began in January 2022, under the then Conservative government. The target was to significantly boost the GBP 38.1 billion a year bilateral trading partnership; but the talks hit a block in the 14th round of negotiations to make way for general elections in both countries.
A report in The Daily Telegraph yesterday quoted a New Delhi source to claim that the Indian side would seek clarity on whether the Labour government intended to pick things up from where they were left off, or would start afresh in some way.
“India is keen to resume [FTA] talks on a positive note, but the date needs clarity,” the source told the UK newspaper.
“The trade deal was at the final stage in the previous government, and we want to see whether the Labour government wants to start from where we left it in March before the elections or start afresh from scratch. Our stance on visas for professionals remains unchanged. We are expecting a positive outcome under the Labour government,” the source added.
During his last major intervention on India-UK relations, just days before Labour’s landslide electoral victory earlier in July this year, Lammy had told the India Global Forum (IGF) in London that he intended to get the deal done as soon as possible.
“My message to [Finance] Minister [Nirmala] Sitharaman and [Trade] Minister [Piyush] Goyal is that Labour is ready to go. Let’s finally get our free trade deal done and move on,” he said, lamenting former UK PM Boris Johnson’s missed Diwali 2022 deadline.
With Labour, the days of Boris Johnson reciting that old verse from Rudyard Kipling in Asia are over. If I recite a poem in India, it will be Tagore… because with a superpower like India, the areas of cooperation and the areas for learning are limitless.
David Lammy, UK Foreign Secretary
On visas, which have been described in the UK media as a major sticking point in the FTA talks, Indian High Commissioner Vikram Doraiswami clarified at the same forum that it was “not the first priority” for India.
The Indian envoy explained, “What we’re trying to do with this free trade agreement is to increase the depth or the extent of ambition, including in goods and services, that we’d like to offer to the UK.”
He said, “Visas are not the first priority for us in an FTA. We are not looking at the FTA as a means to bring people to the UK; that is not the objective.”
Doraiswami added, “What we’re looking for is whatever is reasonable within the broad framework of international trade and services under Mode 4 of GATS [General Agreement on Trade in Services of the World Trade Organization] to be able to have persons travelled for intercompany transfers etc.”
Prime Minister Keir Starmer-led UK Labour Party manifesto has pledged to seek a “new strategic partnership with India, including a free trade agreement, as well as deepening cooperation in areas like security, education, technology and climate change”.
Lammy’s expected visit to India this week, on his way to the 57th ASEAN Foreign Ministers’ Meeting at Vientiane in Lao People’s Democratic Republic (aka Laos), is expected to set the tone for how this pledge is to be realised.
