Prioritising India-UK Ties, FTA in Focus Under New PM Keir Starmer

The Labour government will be hoping to complete Free Trade Agreement (FTA) and immigration issues in a sensible manner unlike the way the Conservative Party did.
India-UK Ties
India-UK Ties

The landslide majority of new Prime Minister Keir Starmer on Friday has paved the way for a fresh chapter in the country’s relations with India as the Labour Party takes charge of steering the stalled Free Trade Agreement negotiations during the outgoing Rishi Sunak-led administration.

If recent high-profile visits by the shadow cabinet members, stepping up as Cabinet members, are anything to go by, the choreography around India being a priority country is likely to see at least some degree of continuity.

However, despite a manifesto commitment to build a “new strategic partnership” and the then shadow foreign secretary and now the Foreign Secretary in Starmer’s government, David Lammy promising to be on a flight to India before the end of July if elected, how much of a priority India will be among the various domestic pressures facing a cost-of-living crisis hit Britain remains an unknown factor.

The India-UK FTA talks began in January 2022 but were stalled in the 14th round as both countries stepped into their general election cycles this year. India saw the new government in the first week and on Friday, it was the UK's.

“There is no question in my mind that India will continue to be important for the new Labour government,” said Rahul Roy-Chaudhury, Senior Fellow at the International Institute for Strategic Studies (IISS).

“But what we don't know yet is to what extent and what would be the priority that the Labour government will put across in relation to India; is it going to focus on the Euro-Atlantic theatre or the Indo-Pacific theatre? And, within the Indo-Pacific region, the other unknown is how important will India be,” he said.

Roy-Chaudhury said he would like to see the new government appoint a dedicated “India Champion” to set a firm ambition for its relations with one of the largest economies in the world.

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Lord Karan Bilimoria, a crossbench peer who has led many trade delegations to India, expressed confidence that Starmer would set the right tone in terms of student visas and end the hostile Conservative rhetoric around immigration.

“With Keir Starmer now being in power, this is a great opportunity to turbo-charge the UK-India relationship, which was very strong under (former Tory prime minister) David Cameron but since then has not been anywhere near as effective,” said the founder of Cobra Beer.

“The Labour government will prioritise India, will prioritise completing this Free Trade Agreement (FTA), will address issues like immigration in a sensible manner and not in a hostile manner the way the Conservative Party did, driven by their extreme right-wing,” he said.

Manoj Ladwa, founder of the UK-based India Global Forum (IGF) – where Lammy last week made his commitment to signing off on an FTA and described it as “a floor not a ceiling” of the partnership he aspires to, described the trade deal as a “litmus test” of what the future holds for the two countries.

“The challenge for Keir Starmer, however, will be to insulate himself from domestic activist groups who seek to import the politics of the sub-continent and influence Labour foreign policy and the wider national strategic interest to engage positively with the world's largest democracy,” he cautioned.

Other strategic experts pointed to the Labour government’s “progressive realism” stance on foreign policy as implying a more pragmatic and less ideologically driven approach.

“I think it's generally a positive trajectory and in terms of the FTA, the strategic case is almost as important, if not more important, than the economic … there are obviously some sticking points, but consensus has been reached in most of the chapters,” noted Chietigj Bajpaee, Senior Research Fellow at Chatham House in London.

Meanwhile, the prospect of Lammy travelling to India as the new UK Foreign Secretary in the coming weeks is likely to be the first indication of the priority level India is placed under by the incoming government.

“The engagement they [shadow cabinet] have been having recently has really helped to build up their understanding of India, and they've been incredibly positive about what they want to achieve in India,” said Kevin McCole, managing director of UK India Business Council (UKIBC), who is on his way to India next week to build momentum around the trade talks.

“We've had the 2030 Roadmap, I think it's time that can be refreshed and extended to include a range of other elements, and within that trade and investment has got to be there, including resuming those FTA negotiations and concluding them swiftly,” he added.

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