London: Data localisation and British companies being allowed to bid for Indian government contracts are among the issues causing a possible deadlock in the final stages of the India-U.K. free trade agreement (FTA) talks aiming for a Diwali draft completion deadline, according to a U.K. media report on Sunday.
The Daily Telegraph quoted a source close to the talks to say that data localisation rules that prevent foreign firms from taking data out of India and allowing U.K. firms to bid for public-sector contracts are two key “sticking points” to a comprehensive deal.
The likelihood of a so-called ‘thin’ trade deal within the symbolic Diwali (October 24) deadline and further ‘iterative’ deals at a later stage is now looking like a likely outcome.
“The stumbling blocks are absolutely to do with digital. How ambitious and comprehensive this deal is, is in some way a function of time,” the newspaper quoted an “insider” as saying.
It follows U.K. Trade Secretary Kemi Badenoch indicating last week that just because there may be an FTA struck with India, it did not mean “we cannot do even more later”.
The Department for International Trade (DIT) also reiterated the government stance that any FTA would be agreed to only if it met the U.K.’s interests.
It follows a week of controversial interventions that cast a shadow over the prospect of a wide-ranging bilateral trade agreement, with U.K. Home Secretary Suella Braverman expressing ‘reservations’ over India being offered some sort of ‘open borders’ visa concessions.
While India countered the minister's claims that a Migration and Mobility Partnership (MMP) between the countries had not “worked very well” in tackling visa overstayers, strategic experts suggested the wrangles may well end up in a diluted trade pact.
The prospect of Prime Minister Narendra Modi's U.K. visit towards the end of the month to sign off on an FTA draft around Diwali is also seen as shaky at this stage.
The Diwali timeline was announced enthusiastically by former Prime Minister Boris Johnson during his visit to India in April.
