UK to target India’s middle classes for new trade deal

International Trade Secretary Liz Truss hopes talks will start in the autumn

The UK is targeting a trade deal with India focused on British-made cars and services. Getty Images

The UK is set to target India’s middle classes in a trade deal with a focus on whisky, British-made cars and services.

Talks over a free trade agreement with India are intended to start in the autumn.

International Trade Secretary Liz Truss has launched a 14-week consultation to gather views from the public and businesses before talks begin.

The UK government is seeking new trading partners in the wake of Brexit.

Prime Minister Boris Johnson had been due to travel to India in April to meet his Indian counterpart Narendra Modi. The trip had to be cancelled due to the surge of coronavirus cases in India, which has since led to a rise in India variant cases in the UK.

Earlier this month, India and Britain committed to a deeper relationship over the decade in an array of areas and separately announced a trade deal worth £1 billion ($1.38bn).

Mr Johnson and Mr Modi agreed to strengthen work on health, climate, trade, education, science and technology, and defence.

The trade package raised hopes of a comprehensive deal between fast-developing India and post-Brexit Britain, with London aiming to double trade levels by 2030.

The UK government now says it wants a larger deal to allow trading with India’s £2 trillion economy and 1.4 billion potential customers.

This would include removing tariffs of up to 150 per cent on whisky and 125 per cent on British-made cars, as well as a focus on industries such as science, technology and services.

India was the UK’s 15th largest trading partner in the four quarters through end of the 2020, accounting for 1.6 per cent of total UK trade.

Ms Truss said: “We’re firing the starting gun on a free trade deal with India – the world’s largest democracy, fifth-biggest economy, a nation of 1.4 billion people, and a huge market for British goods like whisky, cars and services.

“We want an agreement that pushes new frontiers in industries of the future and helps us build a greener, more innovative and more services-led economy that will deliver higher-paying jobs across the country.”

International trade minister Ranil Jayawardena said: “India is one of the world’s fastest-growing economies and we share much in common, so we’re natural partners.

“A trade deal will break down barriers, making it easier for British businesses to sell their wares in India – and secure more investment, better jobs, higher wages, more choice and lower prices here at home.”

The public consultation will run until August 31 and is a necessary step before talks can officially begin.

Sue Davies, head of Consumer Rights and Food Policy at Which?, said:

“It’s good to see the UK is preparing to start trade talks with India and is inviting input from the public, including consumers. A trade deal could offer great opportunities for UK trade post-Brexit – provided that the government delivers on the issues consumers care about.

“Our research shows that people want trade deals that prioritise high food, product, data protection and environmental standards and deliver for consumers in all parts of the UK. The success of future agreements will be judged on what they deliver for ordinary people in their everyday lives, not just the trade opportunities they provide.”