Business groups call for UK government to 'slow down' India trade negotiations

Thu 11 Aug 2022
Posted by: Phillip Adnett
Trade News

India UK Free trade deal business calls slow down

British business organisations are calling on the government to drop its self-imposed October deadline for a trade deal with India and concentrate on getting a “deal which matters for UK businesses”.

Eleven trade bodies have written an open letter to trade secretary Anne-Marie Trevelyan, asking her “to hold out for a commercially meaningful and comprehensive deal” rather than a quick one.

Signatories of the letter include the Society of Motor Manufacturers and Traders (SMMT), TechUK, the City of London Corporation, the Law Society of England and Wales, the Association of the British Pharmaceutical Industry, and the Chemical Industries Association, reports Politico.

As reported previously by the IOE&IT’s Daily Update, both governments are aiming for an agreement “by Diwali in October.”

What about services?

Britain’s services sectors, which make up about 80% of economic activity, are concerned that the deal focusses on lowering tariffs rather than the regulatory alignment that would benefit them.

Alastair McCapra, chief executive of the Chartered Institute of Public Relations, called for “an ambitious trade deal that delivers on the UK government’s commitment to be a services powerhouse” rather than “rushing to meet deadlines”. 

A Department for International Trade (DIT) spokesperson said: “We remain clear that we won’t sacrifice quality for speed and will only sign a deal which delivers for the UK.”

More details needed

Mike Hawes, chief executive of the SMMT told Politico, “Quick deals don’t necessarily go into all the necessary detail that you need.”

He pointed out that the details have yet to be fully negotiated and, as well as tariffs, that the deal would need to look at rules of origin requirements for products like British-made electric cars, which face prohibitive barriers in India.

Pesticide warning

A report from Pesticide Action Network UK (PAN UK) and Sustain Alliance has also warned that under the deal Indian crops grown with high levels of pesticides – such as rice, wheat and tea – could reach the UK, reports the Express.

It could also risk undercutting UK-based farmers, who may be unable to compete with cheaper produce from India, it claimed.

Josie Cohen, head of policy and campaigns at PAN UK, said: “Entering into a rushed trade deal with India would be a recipe for disaster for the UK farming industry, effectively giving Indian agribusiness a competitive advantage at a time when we are asking British farmers to produce more sustainably.”

A DIT spokesperson told the Express: “We have strict statutory limits for pesticide residue levels on imported food and a robust programme of monitoring. An FTA with India won’t change this – products which don’t meet our requirements won’t be permitted to enter the UK market.”

Talks ongoing at pace

A joint statement from the UK and India said negotiators on the fifth round of talks are working “intensively throughout the summer towards our target to conclude the majority of talks on a comprehensive and balanced tree trade agreement by the end of October 2022”.

India’s commerce and industry minister Piyush Goyal said this week that talks are moving at a “faster pace”.