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Brexit Unlikely To Impact India-UK Trade Ties

NEW DELHI: Partings can be bittersweet. The United Kingdom (UK) is realising this as it prepares to exit the European Union on October 31. With every turn and twist of the Brexit saga, anxieties are growing among the domestic audience and those overseas.

The latest twist has seen Britain’s Supreme Court pass an order on September 24, which ruled that Prime Minister Boris Johnson’s suspension of Parliament earlier this month was unlawful. The order has resulted in Parliament reconvening much to Johnson’s great annoyance as it jeopardises his push for a ‘no deal’ Brexit.

SNI got a sense what many of Johnson’s own partymen feel when rebel Conservative party MP Sir Oliver Letwin spoke at the Brookings India think tank recently on ‘Brexit and The Future of Europe’.

Letwin is a Remainer, having voted for the UK to stay within the EU. He was also part of an alliance of 21 rebel Conservatives who opposed Johnson’s bid for a ‘no deal’. All were expelled from the party.

In Letwin’s view “It’s not democratic or sensible to leave without a deal,” pointing out that “The best case scenario would be that the PM succeeds in arriving at a deal that’s acceptable to the EU and can gain majority support in Parliament and I will vote for any deal that he brings back from the EU.” As for the worst case scenario, he said, ”We have no deal and we leave without it on October 31”.

The prolonged turmoil has deepened the sense of fatigue among the domestic audience. A large number feels the focus on Brexit has been to the detriment of other pressing issues.

There’s anxiety on the part of other countries too as they wait for the UK to exit the European Union. India has been keeping a close eye on developments given that it’s a major trade and investment partner of the UK.

The UK is among India’s major trading partners and during the year 2016-17, it ranked 15th on the list of India’s top 25 trading partners. India is the third largest investor in the UK where Indian companies have created over 1,10,000 jobs.

Concerned about the impact its divorce from the EU would have on trade and investments, the UK has been eyeing a free trade agreement (FTA) with India. Indeed, the UK sees Brexit as an opportunity to negotiate a separate trade pact with India, a point which was reiterated by PM Johnson earlier this month on the margins of the G-7 Summit in Biarritz, France when he said he discussed a “big” FTA with PM Modi.

Former Indian foreign secretary Ranjan Mathai who had served as India’s high commissioner to the UK said, “I hope to see some progress towards negotiations with India on an FTA. I think we will be able to move fairly quickly and the UK will certainly need it,” adding that “It will be in their interest and of a lot of Indians in signing an FTA with the UK.”

A former Indian diplomat noted that the “Indian relationship will remain very strong with the UK irrespective of what form Brexit takes. The stakes are very deep and old.”

Acknowledging that “Indian investments were predicated on the possibility of using Europe as a market,” the former diplomat said that Indian business “will work through that and whatever form of relationship the UK ultimately works out with Europe.”

Mathai also drew attention to the proposed India-EU FTA that’s been hanging fire since 2007. “We have the possibility of an FTA with the EU…It will be a fairly high priority for the EU once Brexit happens as they need to make sure that this one disruption will not cause any disruption externally.”


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