Britain must raise its game in India
The inconvenient fact for Britain, the EU and India is that no one knows the terms of Britain’s exit—whether it will be a messy divorce or a friendly one
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“When the facts change, I change my mind. What do you do.”
That’s a quote widely attributed to the English economist John Maynard Keynes.
Whether or not he said it (experts aren’t sure—they never are), it is an axiom that probably should underpin governance and international relations.
It reflects evidence-based policymaking. We don’t have to go quite as far as Kellyanne Conway, adviser to US President Donald Trump, did in proclaiming the existence of “alternative facts”. Still, it is sobering to cast our minds on a piece of news broken by The Daily Telegraph this week about the British government’s immigration plans.
According to the report in the pro-Conservative paper (unconfirmed at the time of going to print), British plans for a free trade agreement with the US include greater two-way immigration.
Prime Minister Theresa May was the first foreign leader to meet Trump and a free trade agreement is high on the agenda in the backdrop of Britain’s imminent exit from the European Union.
With trade between the US and EU making up the largest trade relationship in the world, post-Brexit Britain needs Trump.
In danger of losing longstanding European friends, Britain is desperate to strike up free trade arrangements with economic powerhouses.
Trump, too, is keen on foreign friends—and who better to turn to than that jilted half of the Special Relationship—after the controversy surrounding his inauguration and travel restrictions placed on seven Muslim-majority nations.
This is the start of an Anglo-American special relationship for the 21st century—birthed in Realpolitik and little else.
Ideologically, in terms of shared values, it looks pretty empty—the figleaf of interest is its newness.
Protests are growing in the UK against Trump’s policies, so much so that May was forced to criticize the US travel restrictions in a Parliament statement, unprecedented in recent Anglo-American relations.
But this, it seems, is just one half of what appears to be a bizarre plan by the UK government to encourage inward immigration from predominantly white countries—also favoured, apparently, are Australia and New Zealand, but not India or China, two countries whose young and talented workforce are hungry for global opportunities.
The UK is also keen—according to May—on negotiating a free trade agreement with India.
British foreign secretary Boris Johnson came knocking on India’s doors the other day, talking up a deal and pointing to his Sikh family (his mother-in-law is Sikh) in an oblique reference to his Indian connection.
Johnson laid out a free trade scenario that is hard to resist.
Indians, he pointed out, swill a mind-boggling 1.5 billion litres of ‘whisky’ per year. Not much of it, it is safe to assume, is actual Scotch whisky (i.e. stuff made and bottled in Scotland), as opposed to something called ‘Indian Made Foreign Liquor’ because India imposes a stiff 150% tariff on Scotch.
Lower those tariffs, he said, and in exchange, sell your Indian-made electric cars to the UK.
Johnson seems unaware of the fact that that was always going to be the case if—and it’s a long shot admittedly—India and the European Union succeed in hammering out their free trade deal.
This is where Keynes comes in.
Brexit happened last summer and, suddenly, India was having to deal with not only the long-pending EU free trade deal, but also a possible agreement with post-Brexit Britain.
Facts changed. The inconvenient fact for all three is that no one knows the terms of Britain’s exit—whether it will be a messy divorce or a friendly one.
As for Scotch whisky, the fact remains that how Scotland’s economic relationship with Britain and with Europe unfolds post Brexit is still unclear.
Scotch whisky sales are growing after three years, purely on account of Indian demand, according to the Scotch Whisky Association.
Scotch whisky exports grew by 3.1% in the first six months of 2016, driven by a 41% increase in Indian sales by market share (28% by value).
It is no surprise that India’s response to Johnson’s Delhi speech was lukewarm, wait-and-watch stuff.
India’s top export is not electric cars—not yet.
It is its skilled manpower.
Indians would quite like the freedom to work and live in the UK, the guests were told politely by the country’s high commissioner in London.
Johnson did make a reference to this demand.
“We may be leaving the EU and we may be taking back control of our borders,” said he. “But, my Indian friends, that does not mean we want to haul up the drawbridge or deter Indian talent from our country.”
As assurances go, this wasn’t the red carpet Indians were looking for.
To be fair, Indians were the second largest beneficiaries of British visas for the year ending June 2015. There was a 16% increase in numbers with 86,117 visas granted to Indians, just behind the Chinese.
And these were non-tourist, non-transit visas. There was a similar rise in the number of tourist visas for Indians.
Indians made up 56% (a total of 31,058) of sponsored work visas that were granted in the year to March 2015, according to UK government figures.
These visas need to be sponsored by an employer—often an Indian software company—and are usually for a fixed period.
But this needs to be balanced against the fact that the number of student visas granted to Indians has fallen dramatically over the years.
Theresa May’s recent suggestion—made in New Delhi—that the numbers could go up if India took back Indian ‘overstayers’ would not have pleased her hosts.
Johnson’s visit may have been intended to keep interest from flagging.
“I believe I am the man to do it,” he declared about the free trade deal.
Will he do it mindful of Indian demands?
India will want an early bite of the pudding as proof of the boast—Sikhs, Johnson will surely know, are known to be faithful friends, regardless of changing facts.
Dipankar’s Twitter handle is @Ddesarkar1