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From Old Crown Jewel to Big New Market: UK Sees an India Opening for its Brexit Dream

File photo of Prime Minister Narendra Modi with British counterpart Boris Johnson. (Reuters)

File photo of Prime Minister Narendra Modi with British counterpart Boris Johnson. (Reuters)

Britain has been just as keen on an Indian opening to its services like banking, insurance, accountancy, law. India too has been looking for easier access for its services in the UK, and that includes an easier visa regime for movement of its professionals in services.

Sanjay Suri

At the heart of Brexit lies a recall to lost grandeur that Brexiters believe was limited by Britain’s position as a mere member of the European Union. Every word through 599 pages of the withdrawal agreement and now 1246 pages of a parting trade deal with the European Union is written to eventually serve that end.

Brexit is an intended relaunch of the lost greatness, of a Great Again Britain: this time through building a commanding new position in the world, not colonising. But the Brexit lobby has long sought a revival that is colonising-like.

“What prospects lie ahead of us for our young people now,” declared Conservative leader Iain Duncan Smith, “to be out there buccaneering, trading, dominating the world again.” Not through military but through money, though this “buccaneering” idea does evoke images of the East India Company and the colonisation that followed.

The Brexit keyword now is not colonisation, it is dominance. The call to a new dominance recalls Empire-building, even if not in so many words, and certainly not in the same way.

There’s no place for any real parallel between a colonial past and the current dream of dominance that Brexit has brought, but no one is forgetting that Britain rose to its dominance earlier through trade. That began some centuries back, and began to end only less than a century ago. India must sit at the heart of such evocation, and it does. The old jewel in the crown is being built up as the big new market to trade with, really to sell to.

Past a trade deal with the EU, a new agreement with Japan and a continuation of EU-equivalent trading terms with Canada, Turkey and some other countries, the great new prize being offered is a new trade deal with India.

The Daily Express, a hard-core Brexit-backing tabloid, ran a story days ahead of Brexit: ‘What a way to wave goodbye to Brussels! Boris nearing £100 BN trade deal with India’. The newspaper based that on a remark from Gaurav Singh from the investment firm JPIN that trade “as high as £50-100 billion two way is easily achievable.”

The two governments are talking already in that direction. Commerce minister Piyush Goyal has spoken of an early harvest deal between the two countries. That metaphor was extended into declaring a plan to go for the low hanging fruits soon, which meant to cut duties on a limited number of goods while the two countries work towards a larger free trade agreement. The early harvest plan identifies five areas – the life sciences, information communications technology, chemicals, services, and food and drink.

Talking drink, Scotch whisky has been particularly on the table. Boris Johnson is personally very keen on a reduction in Indian duty on Scotch whisky, he has been speaking of this again and again at Indian events, including a visit to a gurdwara. “Whenever we go to India, to Mumbai or Delhi, we have to bring clinkies in our luggage, we have to bring Johnny Walker, we have to bring whisky,” he said at a gurdwara meeting. “Because as you may know, there is a duty of 150 percent in India on import of Scotch whisky.” He wants that to go, at least to be cut.

Britain has been just as keen on an Indian opening to its services like banking, insurance, accountancy, law. India too has been looking for easier access for its services in the UK, and that includes an easier visa regime for movement of its professionals in services.

Not Fruitful

It’s not going to be easy. Not even low hanging fruit may be within early grasp. In services, Indian companies made Britain a launch pad so far for all of the EU market. But the trade deal with the EU places restrictions on services out of the UK. Britain-based Indian IT companies will simply not have access to EU markets as they did before.

Talking Scotch whisky, as the British Prime Minister does, the Indian Prime Minister Modi is hardly likely to prioritise lower duty on Scotch as an achievement of his government. With Scotch the British want more. Britain wants lower duties eventually on import of its cars to India. Again, Prime Minister Modi is hardly likely to substitute ‘Make in India’ with ‘Import from Britain’.

India negotiated a free trade agreement fruitlessly with the EU over several years that yielded neither low-hanging fruit nor any other. An agreement could not be reached substantially because Britain as a then influential member of the EU wanted concessions India was not prepared to make.

What concessions could India now make for Britain alone that it could not for the EU then, or will not through talks with a Britain-less EU now? And what is it that Britain could now stop wanting?


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