Stop India-Britain Free Trade, Can Sunak Open The Knot?: India’s ‘Free Trade Agreement’ with Britain is stalled. Key problem areas are immigration policy, and import duties on alcohol, and cars. Will Rishi Sunak quickly execute this agreement? in pen Amitabh Sen
Non Housing policy, alcohol, and motor vehicles. India’s ‘free trade agreement talks with Britain, which left the European Union two years ago, stalled even after passing the midway point. To this must be added the turbulent economic climate and war situation of that country. Sufficient fuel shortages, skyrocketing costs of power generation and intense demand (especially in winter), industrial slowdown, fears of rising unemployment, record inflation, and above all maintaining stability of the international monetary reserves – a dire situation on all fronts. The rising sage is undoubtedly a big challenge for Sunak. But he is ready for any tough fight in the interest of the country – this was his first message after being elected as the Prime Minister.
President Xi Jinping, who was unanimously elected for a third term in China, made radical changes in the structure of the party hierarchy, administration, and military a few days ago. Whether Sunak, who is staunchly anti-China like Liz Truss, will stick to the current ‘tough policy’ or embark on a new mission is no less a big question.
However, there is a light, albeit mild, reluctance among the EU member states around the ‘sanctions’ against Russia. Meanwhile, famine threatens Africa as food supplies from Russia and Ukraine are cut off. Responding to the request of the United Nations and the appeal of the World Food Program (WFP), Russia has temporarily lifted the embargo on the supply of food grains from Ukraine to the hungry and famine-stricken African people. Britain’s severe energy crisis is feared to have an impact on all industries – large, medium, and small. Britain is looking to deal with the situation by boosting exports and creating jobs by shrinking foreign workers. And, for that reason, the importance of the Britain-India Free Trade Agreement is immense for the Sunak government in the fluctuating economic situation of the country. Presumably, it was this economic outlook that led former Prime Minister Boris Johnson to conclude the deal in less than a year. Johnson’s plan was strongly criticized by several top leaders of Britain as an attempt to ‘rush’ India to get something quickly. Sunak is tasked with the government’s commerce department to allay the concerns and doubts of those critics
Minister Greg Hands has just told parliament that Britain will not sign the deal unless it is seen as fair and in mutual interest.
The two countries are negotiating mainly on three issues – reducing import duties imposed by India on alcohol and motor vehicles, and imposing restrictions on job seekers traveling from India to Britain. Estimates show that India is more likely to be tough on the issue of ‘immigration’, despite a soft stance on reducing import duties on alcohol and automobiles. Suella Braverman, Home Secretary in the Lease Truss Cabinet, commented that the number of Indian immigrants to Britain would increase if this agreement were reached. This caused a strong reaction not only in New Delhi but also among Indians in Britain. Braverman resigned. Then Liz Truss also had to leave with the responsibility of not being able to handle the overall situation of the country.
According to Braverman’s data, Indians make up the largest number of overstayed migrants in Britain. According to estimates two years ago, the number of Indian migrants whose visas had expired in 2020 but remained in the country was 20,700 or slightly more. In an interview with The Spectator, Braverman said the country’s people did not support Britain leaving the European Union to adopt an open-border immigration policy with India. But what is very significant – despite making such comments on the eve of the free trade agreement with India, Sunak has brought back Suella Braverman, who is known to be a radical rightist, in his cabinet!
Early last month, one of the members of the Parliament’s International Treaties Committee, Daniel John Hannan of the Conservative Party, also gave an important speech on visas. However, he thinks that this agreement will result in the greatest mutual benefit of the two countries in the field of technology, engineering, and coding. There is a professional exchange of skills and talent. This requires a change in the current visa policy. Daniel Hannan also wants to send a message to India that to speed up the resolution of the visa-related issue, India should take initiative to quickly bring back those Indians who are working in Britain and those who are illegally in Britain. On the other hand, the central government is pressuring Britain for more ‘work permits’ and ‘tier three’ visas for Indians based on information provided by Lord Hannan.
Is it possible to have an agreement between the two countries – where it is easier for Indians to come to Britain legally than it is to enter illegally? However, while talking about the contribution of more than 1.5 million people of Indian origin living in Britain, another member of the international committee, Viscount Younger (Fifth), reminded that Britain’s AstraZeneca and India’s Serum Institute worked hand in hand in the production of corona vaccine. Indian-owned but British-made Jaguar Land Rover employs more than 35,000 people. There are many examples of economic cooperation between the two countries.
India’s excise duty on alcohol (150 percent) is the highest in the world. Of this argument, Britain demanded to reduce the tariff rate to at least 50 percent. There is no doubt that India’s income from import duties will decrease a lot. But a section of experts opined that the reduction in the duty would increase sales, ultimately benefiting India. Taking the example of China, it has been said that after reducing the import duty, the sales of Sura have increased in that country. It is also argued that tobacconists will be able to buy much better quality tobacco and the death rate from tobacco smoking will also decrease. But the majority of Indian musicians are middle class and lower middle class. According to their ability, if the price of the advanced surah is not within a certain limit, how will the sales increase? It is estimated that by the year 2030, the number of surapayees in India will exceed 38 crores. According to the report of ‘The Lancet’, the number of women (15-39) in India is about 40 lakh.
According to the State Bank of India, India’s import duty is 100 percent on cars priced above $40,000. The import duty rate is 60 percent for other cars below $40,000. Britain has therefore demanded a reduction in import duties on cars from India. The path of an international free trade agreement with India is not thorny – what to do next?
(Opinions are own)
The writer is a journalist
asamitabha@gmail.com
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