Labour Elected In Britain- Will There Be Shift In India Relations?

The Labour Party leader Keir Starmer is going to become the next Prime Minister of the UK ending the 14-year Conservative Party rule. For India, the question is how the Labour Party election will change Britain’s relations with the Asian country. As per the analysts, the change in the government will have a slight shift in the bilateral relations between both countries.

Considering Keir Starmer’s outlook towards India which is reflected through his manifesto presents a positive picture. The manifesto commits to pursue a new strategic partnership with India through Free Trade Agreements (FTA) which marks a significant shift from the Labour Party’s earlier stand under Jeremy Corbyn, who was perceived to have an anti-India attitude due to the Jammu and Kashmir issue.

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As per the experts, the Labour Party will likely change some terms and conditions of the FTA considering their earlier orientation for India. However, considering India’s economic position and strength, it is highly unlikely that India will come to terms easily. The UK pushes for lower import duties on goods like scotch whiskey and electric vehicles.

The India-UK FTA was not finalised by the government led by Rishi Sunak for which the negotiations, began in January 2022. The Labour party criticised the earlier government for over promising and under delivering to UK India FTA and declared it is ready to go on finalising the deal.

Political stability is also important for a trade agreement with India, potentially involving high tariff levels, remained elusive in London since the unexpected Brexit referendum.

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Immigration also remains a contentious issue for the Labour Party. New Delhi seeks temporary visas for its service industry workers, hoping to benefit significantly from the FTA. Labour party expects to push for favorable visa terms considering the current political landscape in the UK.

Notably, the bilateral trade between both the countries have increased to $20.36 billion in 2022-23 from $17.5 billion in 2021-22.