The UK is set to relaunch trade talks with India at the start of next year, as Sir Keir Starmer said he wanted to take Britain’s relationship with Delhi to “another level”.
Following a meeting with Indian prime minister Narendra Modi at the G20 summit, Sir Keir said he was “very ambitious” in terms of securing a “new strategic partnership, not only on trade, but “on energy and on so many issues, including security”.
The prime minister has said that a deal between the world’s fifth and sixth largest economies would help support jobs in the UK, with a trading relationship with India worth £42bn in the 12 months to June 2024, according to Downing Street.
As it was confirmed that trade talks would restart in early 2025, Sir Keir said: “Boosting economic growth is key to improving living standards for working people.
“A new trade deal with India will support jobs and prosperity in the UK – and represent a step forward in our mission to deliver growth and opportunity across our country.”
Discussions between New Delhi and London over a trade deal had stalled under the last government. While Boris Johnson had previously said he wanted a deal done by October 2022 to coincide with Diwali, Rishi Sunak’s administration had declined to set a target date for signing off on an agreement.
When the negotiation began in January 2022, the aim had been to double trade between the UK and India to £86bn by 2030.
By 2028, India is projected to be the world’s third largest economy. India was the UK’s 11th largest trading partner in the most recent financial year, accounting for 2.4 per cent of total UK trade, according to the UK government.
Describing India as a “vital trading partner for the UK”, business secretary Jonathan Reynolds said: “Whether it’s lowering Indian tariffs to help British firms export to this dynamic market or boosting investment which already supports over 600,000 jobs across both countries, striking a deal is important to deliver this government’s core mission of driving economic growth.”
In July, Mr Reynolds had said that the UK intended “to forge better trading relationships with countries around the world”, and the government said it has since started negotiations with Switzerland, South Korea and the Gulf Cooperation Council.
When asked about what deals could mean for access to the UK labour market Downing Street has said that the talks and any deals will be “rooted in the UK national interest” and said that the position on migration has not changed.
“The government’s position on reducing net migration comes first and foremost,” the prime minister’s official spokesperson said. “We obviously only agree deals that are rooted in the UK national interest.”
The Department for Business and Trade said it will soon unveil its new Trade Strategy, aligned with the Industrial Strategy, to help inform future trade talks and achieve long-term sustainable, inclusive and resilient growth through trade.
Earlier this year the UK and India signed off on a scheme aimed at strengthening co-operation on artificial intelligence and technologies.
Foreign secretary David Lammy travelled to India and the “technology security initiative” was agreed by both nations’ national security advisers following negotiations.
The announcement comes ahead of the second day of the G20 summit, where Sir Keir is expected to hold talks with more foreign leaders.
Elsewhere at the summit on Monday, Sir Keir held talks with Chinese president Xi Jinping, expressing hope for “respectful” relations with Beijing and raising the case of detained pro-democracy activist Jimmy Lai.
Sir Keir also suggested a full UK-China meeting in London or Beijing as part of his desire for “consistent, durable, respectful” ties between the two countries.
However, shadow foreign secretary Dame Priti Patel said the PM should have been “stronger in raising our concerns over human rights” following the meeting.
The meeting with Mr Xi came ahead of talks with other nations including Australia and Japan, with whom Sir Keir Starmer discussed the need to “double down” on support for Ukraine. Tuesday marks 1,000 days since Russia’s full-scale invasion.
Facing questions on whether Storm Shadow missiles will be signed off for Ukrainian use against Russian targets by Ukraine, after US president Joe Biden allowed Ukraine to use US-supplied weapons, Sir Keir declined to get into “operational details” because “the only winner, if we were to do that, is Putin”.
Additional reporting by PA
