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India UK flags

Doubts have arisen about the likelihood of the UK-India trade deal being completed by October, despite insistence from both the UK and Indian government that talks were on track.

Last month, hopes were high that negotiations would be concluded by the end of the year, with significant progress through throughout the G20 trade minister's meeting.

However, the Guardian reported that government officials dismissed the idea that UK prime minister Rishi Sunak will push for completion while attending the conference, taking place later this week (9-10 September).

Sources told the Guardian that a global summit hosted by New Delhi “is not the time and the place” to conclude a trade agreement with India.

What’s gone wrong?

A deal with India has become a major unfulfilled goal of successive Conservative PMs, with Theresa May, Boris Johnson and Liz Truss all making promises to get negotiations over the line during their time at Downing Street.

This time round, when Department for Business and Trade (DBT) secretary Kemi Badenoch visited Jaipur ahead of the G20, only seven of 26 chapters needed finalising.

Sticky issues

However, the remaining chapters have proved to be contentious.

Immigration has remained a sticking point for the UK, with Indian demands for more highly skilled visas for IT and healthcare workers receiving pushback from Conservative ministers.

Intellectual property concerns were also raised by UK firms, particularly in the pharmaceuticals sector, overs fear products could be manufactured more cheaply in India without sufficiently robust protections.

India’s rule of origin terms for British car exports were also deemed too restrictive. Tariffs suggested for car parts made outside the UK would have made profitably exporting to India impossible, given the extensive global supply chains involved in car manufacturing.

Way forward  

Officials believe it’s unlikely the deal will be signed this year, or before either country holds its next elections, with India heading to the polls in spring of 2024.

The government has repeatedly said it is determined to secure an agreement that a good and final deal, rather than pushing through a watered-down version in the hopes of negotiating amendments later. 

India has been resistant to this strategy in the past, with Australia’s light-touch deal, signed last year, failing to develop into further talks.