Today: 1 June 2025
3 September 2023
3 mins read

UK-India Free Trade Agreement Delayed, No Deal Ahead of G20 Summit

Those close to the talks say agreements have been reached in some key areas, such as the need for India to cut tariffs on whisky and cars and for the UK to remove those on textiles and other goods…reports Asian Lite News

UK Prime Minister Rishi Sunak has ruled out a quick-fix trade deal with India, making it impossible to get an agreement over the line in time for this week’s G20 summit in Delhi – and possibly even by next year’s elections, the media reported.

Multiple sources close to the negotiations have told The Guardian the UK prime minister has rejected the idea of an “early harvest” deal, which could have lowered tariffs on goods such as whisky but would not have dealt with trickier subjects such as professional services.

The decision has scuppered any chance of an agreement being struck this week, before the prime minister meets his Indian counterpart, Narendra Modi, in the Indian capital this weekend.

Many now believe a deal is impossible before both countries hold elections in 2024, although some in government still believe it could be reached later this year, The Guardian reported.

It means the prospect of a UK-India free trade agreement, long held up as one of the biggest possible opportunities for Britain after Brexit, remains distant.

One government source said: “There was talk last year of a deal by last Diwali, but that was only going to happen if it was a shallow deal based around a limited number of goods. Kemi Badenoch (the trade secretary) and Rishi Sunak have decided they don’t want to go down that route and so have taken a deadline off the table.”

Another person close to the negotiations added: “India wants to do an early agreement on goods, but the risk is that instead of being the start of a wider trade agreement, that becomes the end point and the UK doesn’t get any of the more fundamental things it wants.” 

Those close to the talks say agreements have been reached in some key areas, such as the need for India to cut tariffs on whisky and cars and for the UK to remove those on textiles and other goods. 

The Sunday Times reported earlier this month that India was prepared to reduce tariffs on scotch whisky by a third to 100 per cent in return for tax breaks for Indian workers in the UK – though British officials say exact figures have not yet been agreed.

This might have been enough to sign a slimmed-down trade agreement this week, according to sources, but Sunak and Badenoch have rejected such an idea for fear it will make the goal of a more wide-ranging deal impossible, The Guardian reported.

There are still significant areas of disagreement when it comes to the comprehensive deal under negotiation.

India has long pushed for more visas for Indian students and for employees of Indian companies. The Home Office does not want such terms being placed within the trade agreement itself, although sources indicate a separate deal could be reached on immigration.

The UK says it has already shown flexibility on visas, more than doubling the number of work visas it gives to India each year since the country left the EU. 

But the government is reluctant to change the rules on who can enter, especially in the case of students, The Guardian reported.

However, there are also more fundamental issues facing reaching an agreement.

The UK is pushing for greater intellectual property protections for companies trading in India, especially in the pharmaceutical industry, where western companies fret about their drugs being produced much more cheaply by Indian laboratories.

Meanwhile, India wants to limit the proportion of UK goods that can be produced outside the UK, as a way of preventing other countries benefiting from the agreement indirectly, The Guardian reported.

ALSO READ-Sunak’s cabinet gets new Indian-origin minister

Previous Story

Gabon reopens borders after coup

Next Story

Vivek Ramaswamy’s Taiwan Policy Proposal Sparks Political Discussion

Latest from -Top News

UAE aid for Gaza in global focus

Titled Hope Remains, the documentary brings to light the UAE’s leading role in providing vital aid and support to the people of Gaza. The International Humanitarian and Philanthropic Council has released a

Syria, Israel begin quiet talks

The announcement came just hours after Israeli warplanes reportedly carried out new airstrikes in Syria’s coastal provinces of Tartus and Latakia, hitting a range of military targets. Syria has confirmed the commencement

Gaza truce deal hits new snag

US says Hamas’ reply to the ceasefire plan was “totally unacceptable” and accused the Palestinian group of dragging the negotiations backward. The latest attempt to broker a ceasefire in Gaza has hit

IAEA flags Iran enrichment spike

The International Atomic Energy Agency (IAEA), in two separate but related reports, said Iran has boosted its uranium stockpile enriched up to 60% purity by nearly 50% since February. Iran has vehemently

World needs Dubai’s ambition: Morgan

Piers Morgan has hailed Dubai’s transformation as an example of what visionary leadership can achieve. British broadcaster Piers Morgan has praised the extraordinary ambition and vision of His Highness Sheikh Mohammed bin
Go toTop

Don't Miss

‘Rajkot loss has to be a wake-up call for Stokes & Co’

Former England captain Michael Vaughan urged England to come out

LG Profits Quadruple on Appliances

The operating profit was 27 percent lower than the average