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What an election year looks like for UK-India relations

What an election year looks like for UK-India relations

2024 promises to be a pivotal year, as elections loom in the United Kingdom and India. At a time when the world appears to be increasingly regressing towards instability and violence, from Ukraine to the Middle East, one of the few positive constants is the close trade and defence partnership between India and the UK. Getting a Free Trade Deal done this year between London and New Delhi could politically help the incumbent governments in both countries as they gear up to go to the polls.

India’s marathon election is expected to begin in late April or May, typically lasting many weeks before the winner is announced. Incumbent Prime Minister Narendra Modi’s BJP (Indian People’s Party) is widely expected to win a comfortable third term in the face of a fractured and infighting opposition, robust economic growth and surging foreign investments. To be sure, challenges abound in the form of residual poverty, as well as the underlying potential for communal tension, which has been a tragic presence in the Indian social fabric for centuries. Nonetheless, by any objective yardstick Modi’s India is now the world’s standout economic performer.

India is now beginning to intelligently leverage its large population to become a manufacturing powerhouse, which of course interests the UK as it is a leading technological power, besides being quite capital rich. India is still somewhat capital poor (often requiring infusions of foreign capital for investment) and as such, can capitalise on the funding and investment of British firms.

In no sector is this more apparent than the highly strategic realm of defence and security.  This is why Defence Minister Rajnath Singh’s 3-day visit to the UK earlier this month, the first by such a high-ranking Indian defence official in 22 years, was of great significance. In the past, the defence partnership between India and Britain, which has had abundant potential, was not given the attention that it deserves. With India and Britain signing a Letter of Agreement, on joint defence research during Mr Singh’s visit, this historic error is slowly being corrected. India is trying to modernise its defence research, which has long been plagued by delays and bureaucracy due to overdependence on an inefficient public sector. Leveraging Britain’s world class laboratories, academia and institutions would certainly help India in this regard. Joint weapons developments with other countries such as Russia have helped India develop world class defence capabilities. Similar collaboration with Britain awaits. An agreement on military cadet exchange was also signed which will empower people to people ties.

India spent over $52bn on defence in 2022, an amount that will surely have increased since as global geopolitical tensions continue to mount. A significant portion of this large defence spend goes on acquisitions to replace ageing equipment in India’s military and security forces. It would be beneficial for Britain to be able to provide some of the equipment, as the UK is trying to restart a sputtering economy in the aftermath of the twin shocks of Brexit and then Covid.

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Britain has been at the forefront of naval power for the past few centuries, so there is much that independent India can learn from the operations and shipbuilding procedures of the Royal Navy, being the younger, but faster-growing naval power. India is positioned very, very well strategically as it is a peninsula (surrounded by ocean on three sides) that juts out into the Indian Ocean, where trillions of dollars of trade sail. In 2023, that trade was worth over $6 trillion. India will therefore play a role in protecting the trade that is at the heart of the prosperity of the West, both from piracy as well as providing contingency support should China’s vast new navy choose to target it in the case of hostilities. Strong naval and defence ties with India are simply a must for Britain in the 21st century, due to its geography and common trading interests.

The UK recently announced that it would send its naval forces, including a powerful British Carrier Strike Group, to the Indian Ocean for further joint training with Indian forces from next year. Amidst a background of increasing tension between the US and China over the future of Taiwan, this is a significant move. India has the world’s fourth largest navy, with two aircraft carriers among other significantly capable assets, which could be quite useful to the US and UK as an allied force, should push come to shove, in a match-up against China. Learning to work together as allied forces makes ample sense for both nations.

India-UK trade is also rapidly growing, powered partly by the rise of the Indian diaspora in Britain. The ‘Living Bridge’ of non-resident Indians and Britons of Indian origin is enabling increasing mutual investment and trade to record levels of £38bn by December 2023. This could be significantly augmented by a Free Trade Deal, if one can be done before the elections begin in both the UK and India. Negotiations to get an FTA done and dusted have been ongoing for several years, but there have been constant hurdles to overcome differing perspectives on market access for negotiators from both countries. Britain has been trying to overcome perceived protectionist hurdles in India’s domestic market, while visas for workers remains a contentious subject, as immigration remains a controversial issue in the UK. Differences of opinion also abound on FTA aspects such as tariffs in the markets of both countries. The 14th round of FTA negotiations begin in January 2024.

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Despite having an Indian origin British Prime Minister in Rishi Sunak, obstacles still remain in achieving an FTA. Signing a robust trade deal will increase the scale of Indian investment in Britain, and in the opposite direction too.  While this shows the complexity of modern economies and labour markets, it suggests that UK-India relations are yet to reach their crowning potential. 2024 will show how far both countries go on that journey towards stronger trade and security ties, building on the bedrock of strong people ties of the ‘Living Bridge’.

Jeevan Vipinachandran is a UK-based writer and political analyst specialising in political conflict and counter-terrorism. With a Masters in Comparative Politics: Conflict Studies from the London School of Economics (LSE), his core interest is in international relations with a special focus on the rise of India and its impact on the world stage.

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