From UPSC perspective, the following things are important :
Prelims level : AUKUS
Mains level : Paper 2- India-UK relations
January this year saw the formal launch of negotiations for an India-United Kingdom free trade agreement (FTA).
Momentum in India-UK engagement
- Despite some potential challenges, there is a new momentum in the India-U.K. bilateral engagement these days with both sides confident of moving forward swiftly.
- Greater role for UK in Indo-Pacific: Britain has made a trade pact with India one of its post-Brexit priorities as it seeks a greater role in the Indo-Pacific.
- Brexit has necessitated greater access to non-EU markets, and the U.K.’s changing relationship with China requires a diversification of trading partners.
- The FTA negotiations were aimed at achieving a “fair and balanced” FTA and cover more than 90% of tariff lines so as to reach the bilateral trade target of around $100 billion by 2030.
- There have been indications that instead of the two nations trying to tackle all sensitive issues in one go, there could be an interim pact or early harvest deal.
UK’s Indo-Pacific strategy
- India is at the heart of the U.K.’s Indo-Pacific ‘tilt’, which has generated considerable interest around the world.
- A range of factors have contributed for the U.K. to adopt a more robust Indo-Pacific strategy:
- a) the trading implications of Brexit;
- b) the U.K.’s changing approach towards China — shifting from being a major proponent of China to perhaps the most hawkish in Europe;
- c) and the fact that the U.S. remains firmly focused on the Indo-Pacific.
- The U.K. recognizes the importance of a free and open Indo-Pacific to global stability and prosperity and has made clear its intentions to deploy strategic assets to this end.
- The trilateral security partnership AUKUS has given London a greater voice in the region.
Consider the question “Various factors have contributed towards enhanced India-UK engagement. Examine the factors and the possibilities it offered to the two countries.”
The U.K. is finally carving out a direction and purpose to its post-Brexit foreign policy and this prioritization has opened up a new window for New Delhi and London to quickly finalize their FTA. It is a unique “now or never” moment and the two sides seem willing to seize it despite the challenges.