May woos Modi as UK pursues free-trade deal with India

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Modi as UK pursues free-trade deal with India
Modi as UK pursues free-trade deal with India

Powered by Guardian.co.ukThis article titled “May woos Modi as UK pursues free-trade deal with India” was written by Patrick Wintour Diplomatic editor, for The Guardian on Wednesday 18th April 2018 18.36 UTC

Britain and India have laid the ground for a possible post-Brexit bilateral free trade deal and signed off on a series of commercial agreements worth up to £1bn, according to Downing Street.

Brexit opponents claim the chances of Britain securing a trade deal with India superior to a Indian-EU deal are a fantasy unless the UK makes major concessions on Indian skilled labour accessing UK markets. Karan Bilimoria, the British Indian entrepreneur and life peer, insisted Modi’s priority was a free trade deal with the EU.

Britain is nevertheless lavishing diplomatic attention over Narendra Modi, the Indian prime minister, thanking him for breaking a decade of Indian indifference to the Commonwealth by personally attending the Commonwealth summit and so giving the post-colonial assembly greater relevance.

Modi did not attend the Commonwealth summit in Malta two years ago, and his predecessor, Manmohan Singh, missed the 2011 summit in Australia and its successor in Sri Lanka in 2013.

But Modi, who was personally courted by both Prince Charles and Theresa May to attend the talks, regards the Commonwealth as a useful multilateral forum from which China, India’s great rival, is absent. He is also looking for allies in any trade war with the US.

In common with most Commonwealth leaders, Modi also sees the visit as a chance to woo the City of London and court foreign direct investment.

The Indian prime minister has been rewarded for his commitment to the Commonwealth with Wednesday’s lengthy bilateral meeting with May, an audience with the Queen, a visit with Prince Charles to the Science Museum and a commitment that British intelligence will help fight Pakistan-based militant groups.

In a further sign of British respect, Modi’s plane from Sweden was greeted at Heathrow by the foreign secretary, Boris Johnson. Modi’s aides also claimed he was travelling in a limousine when many other heads of state were due to travel to a Windsor retreat in a bus.

Narendra Modi is greeted by the Queen during a private audience at Buckingham Palace this week.
Narendra Modi is greeted by the Queen during a private audience at Buckingham Palace this week. Photograph: WPA/Getty Images

At a packed town-hall-style meeting in Central Hall Westminster, Modi spoke of his rise from tea seller to visitor to a royal palace, and said the days of incremental change in India were over. Throughout the day he was also pursued by hundreds of demonstrators protesting gainst his attitude to Kashmir, Hindu nationalism and the failure to act against horrific instances of sexual violence against women, including the rape of an eight-year-old Muslim girl.

British ministers say a free trade deal with India is a priority after Brexit, but the joint Indian-UK statement issued after the bilateral meeting acknowledges that the UK cannot sign any new deal until the Brexit transition period ends. The EU is also locked in talks with India over a free trade deal, a subject Modi will raise with the German chancellor, Angela Merkel, in a stopover before he returns to India from London.

After Brexit the UK will initially simply seek to replicate the EU-Indian free trade deal, but any bespoke agreement will be hard to negotiate since India will be looking for concessions on visa travel from India to the UK.

The lengthy bilateral deal signed by the two countries covers cyberspace, technology sharing, solar energy, sustainable urban development, water management, animal husbandry, safe use of nuclear energy, artificial intelligence and big-data analytics.

The joint agreement said a “secure, free, open, inclusive and prosperous Indo-Pacific” was in the interests of India, the UK and the international community, adding: “The UK and India will also work together to tackle threats such as piracy, protect freedom of navigation and open access, and improve maritime domain awareness in the region.”

India regards the statement as significant given Beijing’s tough approach to disputes to the South China Sea and attempts to increase its footprint in the Indo-Pacific region.

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