UK trade deal in jeopardy, Modi must plan new ‘Diwali gift’ for Gujarat

When Prime Minister Narendra Modi and then British Prime Minister Boris Johnson met in India this April, they promised to sign a historic bilateral trade deal by Diwali. However, the new British Home Secretary Suella Braverman, who is of Indian origin, has put a spanner in Modi’s promised Diwali gift, leaving the trade deal in serious jeopardy.

Braverman told the Spectator magazine on the eve of the Conservative Party’s annual conference in Birmingham — ironically, a city in central England with a large South Asian-origin population — that she had grave reservations about offering India “open borders” as part of a Free Trade Agreement (FTA) “because the largest group of people who overstay (visas) are Indian migrants.”

Not content with potentially calling Indian migrants “illegal,” Braverman put on record that the Migration and Mobility Partnership (MMP) signed with New Delhi in 2021 to deport illegal Indian immigrants “has not worked very well” — indirectly accusing the Indian government of not keeping its side of the bargain.

Shock to New Delhi

The new Home Secretary’s comments came as a shock to New Delhi, particularly as her predecessor Priti Patel, also of Indian origin, was very close to both Johnson and Modi and had helped tremendously in building bridges between the two prime ministers. 

Patel, a staunch Brexiteer, favoured a hard stand on controlling immigration and was the architect of UK’s controversial Rwanda Policy, whereby boat people seeking asylum in Britain would be packed on to planes and sent off with a one-way ticket to the African country. However, when it came to immigration from India, Patel, due to her special relationship with Modi, was in favour of a more liberal visa regime, allowing more students, professionals, and businessmen to come into the country.

Born to a Tamil mother and Goan father, Braverman does not have the same special relationship with Modi that the Gujarati-origin Patel did. Braverman also supported Brexit and has more courage than her predecessor to call a spade a spade. She announced to the press that “open-borders migration policy with India is not what people voted for with Brexit.”

Also read: UK-EU ‘historic’ free trade deal marks a new beginning and an end

The Brexit referendum effectively boiled down to the issue of stopping migration into Britain and taking control of the country’s borders. Officially, the issue was stopping immigration from European countries, the campaign fought by the hard Right was to stop migration from all countries. In that sense, Braverman is right when she says that Brexit was not about opening the borders.

Crucial for Gujarat polls  

The India-UK FTA negotiations began formally in January 2022. Having delivered Brexit, Johnson was in desperate need to show the British public that he could deliver an even bigger market to them than Europe, and India fit the bill. 

In return for opening India to British products, India wants visa relaxations for its students to study in the UK, find jobs, and eventually settle down there, entrepreneurs to set up businesses, and professionals to find well-paid employment. The Diwali deadline was crucial for the Modi government, as it could present the open-border policy as its Diwali gift to Gujaratis — who make up a large chunk of would-be migrants to the UK — just before the crucial Gujarat Assembly election to be held by this year-end. 

A liberal visa policy for India seems to be the main sticking point with the FTA, and the UK’s current Prime Minister Liz Truss seemed to be in the mood to seal the deal. In early October, the British press reported that Modi was planning a visit to the UK at the end of the month to sign the FTA and that the crunch negotiations were reaching the “final hardest yards,” with Truss preparing to give ground on more visas for Indian business people and students to get the deal over the line.

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Truss and her Home Minister were at loggerheads over immigration numbers, and the terms of the FTA had caused a row in the new Cabinet. Braverman was effectively gagged by Truss’s office. 

However, not one to be bullied, Braverman came out with her “overstayer” comments, sending shockwaves through Downing Street. Truss was livid. The situation was worsened by a statement from the Department for International Trade, which said “we remain clear we won’t sacrifice quality for speed and will only sign when we have a deal that meets both countries’ interests,” virtually endorsing Braverman’s stand. The British Home Office estimates that roughly one lakh Indians stay illegally in the UK, but New Delhi refutes this figure and claims it is just 2,000.

Bigger worries for Truss

However, since the Party Conference, Truss has had bigger worries than the India-UK FTA. She has been forced to sack her Chancellor of Exchequer, Kwasi Karteng, within 38 days of his taking up the post because of the damage his mini-Budget caused to the British economy. The pound sterling has collapsed, markets have plunged, and the Bank of England has had to step in. While Truss threw Karteng under the bus, hoping it would save her, it has not quite worked out like she hoped.

Also read: Damage control: New UK Finance Minister Jeremy Hunt warns of tax hikes

The knives are out against Truss and, at the time of writing this piece, three Tory MPs had already told her it was time for her to step down. Bets are being placed on how long Truss will remain in Downing Street, and senior Conservative leaders feel she will be gone by Christmas. 

With so much political turmoil and having to fight for survival within two months of becoming Prime Minister, Truss is unlikely to have the headspace for the FTA right now. It is highly likely that Modi will be spending Diwali in India, looking for a new festival gift for the Gujarat electorate.

(Sajeda Momin has held senior positions in Indian newspapers and now divides her time between Kolkata and London) 

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