British Prime Minister Rishi Sunak's surprise announcement of a snap summer poll on July 4 has thrown a wrench into the negotiations for an India-UK free trade agreement (FTA).
Read more: UK general elections on July 4: PM Rishi Sunak (newsarenaindia.com)
Scheduled just a month after India's election results on June 4, this unexpected move has derailed hopes for an imminent deal between the two nations.
Although political analysts and strategic experts remain optimistic about the continuity of bilateral relations regardless of the election outcomes, the brief opportunity for finalizing the FTA under the Sunak-led Tory government has vanished amidst the elections in both countries.
The FTA negotiations, which began in January 2022, aimed to significantly boost bilateral trade, currently valued at around 38.1 billion pounds annually.
However, with the Labour Party leading in pre-election surveys and likely to form the next UK government, the timeline for concluding the FTA remains uncertain.
Rahul Roy-Chaudhury, Senior Fellow at the International Institute for Strategic Studies (IISS), lamented that Sunak's election announcement has dashed any hope of the long-awaited FTA being finalized by the Conservative government.
In contrast, the Labour Party has expressed steadfast support for the FTA, with plans to scrutinize its details upon assuming office, potentially improving relations between the new UK government and the anticipated third Modi administration in India.
Dr. Chietigj Bajpaee, Senior Research Fellow at Chatham House, highlighted the strategic significance of the FTA in deepening bilateral ties, emphasizing its various components including goods, services, investments, and intellectual property rights.
Both nations have specific demands in the negotiations; India seeks greater access for its skilled professionals in sectors like IT and healthcare, while the UK aims for reduced import duties on products like scotch whiskey and electric vehicles.
The UK's outreach to India is part of its broader Indo-Pacific pivot strategy. However, fiscal constraints and other foreign policy priorities, such as conflicts in Ukraine and Gaza, may challenge its sustainability.
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