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Free Trade Agreement: India

Volume 707: debated on Thursday 20 January 2022

We have a slight problem. Will the Secretary of State answer the question? I will then go to the Opposition spokesperson.

I visited India last week to launch negotiations with my counterpart, Minister Goyal, for an ambitious free trade deal. India is one of the world’s biggest and fastest-growing economies and is home to more than a billion consumers, with a growing middle class eager to buy the goods and services that our country excels in. Securing a world-class FTA with India will deliver benefits for people across all four nations of the UK.

We know that India does not cede access to its markets easily and that one of its top demands in any trade deal will be generous visa concessions for Indian citizens to come to the UK. Recent press reports indicate that although the Secretary of State would consider such terms, the Home Secretary would oppose them. Will the Secretary of State clarify the Government’s negotiating position and what their red lines will be?

From services and digital to investment and intellectual property, we are aiming for a broad and ambitious deal with India that delivers for both businesses and consumers alike. The first round of negotiations started this week and we hope the second round of talks will be in March, at which point we will have the opportunity to shape and see the scope of the FTA that both countries want to work towards. We will confirm that at an appropriate time as the negotiations progress. We very much hope to reach a mutually beneficial agreement by the end of this year.

Scotch whisky exports to India, the world’s largest whisky market, have declined dramatically since 2019. A year on from Brexit, the Government can no longer deflect to the EU for their failure to deal with the eye-watering 150% tariffs that apply to Scotch whisky sales to India. Will the Secretary of State confirm today that her Government will finally make the removal of those tariffs a priority?

As the hon. Gentleman says, British products such as Scotch whisky and cars currently face substantial barriers to trade in the form of tariffs of well over 100% on their import into India. The reduction of tariff barriers would be a golden opportunity for UK exporters and, indeed, slash tens of millions of pounds off costs. We will put forward our position in a number of areas, including in respect of Scotch whisky, in the first round of negotiations in the next two weeks. We will make clear the issues that are important to us so that we can achieve a successful, mutually beneficial FTA for all sides.

The whisky industry is used to dealing with weights and measures, but it has been waiting for too long for measures from this Government. Will the Secretary of State confirm what target has been set for tariff reduction for Scotch whisky? Is it half, more than half or—what the industry needs—the complete removal of that 150% tariff? What is her measure of success?

The hon. Gentleman would be surprised if I were to disclose the details of my negotiations mandate at this point, but I think I have already been clear—I will say it again—that it is important that the trade deal is mutually beneficial, and the reduction of barriers to trade such as tariffs will be an important point of the UK’s negotiating mandate.

A free trade agreement with India would be a wonderful thing, but these agreements take a lot of negotiation and a lot of negotiators. When we were in the EU, we lost all our trade negotiators and we have had to build up the Department from scratch. How many free trade negotiators does my right hon. Friend have in her Department? Are there enough or do we need more?

We have a fantastic team of now extremely experienced negotiators. The team who are now focused on the India FTA not only bring with them a wealth of experience from Whitehall, but are experts drawn from a number of fields. We will be cracking on with these discussions, which will be virtual for the first two weeks, because of the restrictions in India, after which we hope to be able negotiate face to face. The teams—for instance those who worked on the Australia free trade deal—work 24/7, or whatever is required through virtual discussions. We will continue to do that, and we have a fantastic team leading the way.