The UK’s trade negotiations with India provide an opportunity to ensure the emerging agreement is a positive example of how trade can serve people and the planet – but the real question is, will it?
This weekend the G20 Summit is being held in India, a country the UK has been in intense trade negotiations with since January 2022. Rishi Sunak is attending the Summit, in contrast to his decision to miss other global summits such as the UN SDG Summit later this month.
The world is waiting for G20 leaders to be bold and decisive in tackling global interlinked crises emerging from debt to food insecurity, rising humanitarian needs, and climate change. The need to reform global financial architecture and scale up investments for a more sustainable, equitable world is ever more pressing.
The UK’s trade negotiations with India provide a significant opportunity to act on political aspirations and international commitments made by both nations. This is also an opportunity to ensure the emerging agreement is a positive example of how trade can serve people and the planet by driving a transition towards sustainable, green, just, equitable economies – but the real question is, will it?
Trade deal-making wrapped in secrecy
India and the UK launched negotiations for a free trade agreement (FTA) in January 2022, and these negotiations are strategically crucial for both countries. The twelfth round of negotiations concluded at the end of August, with the next round scheduled for later this month. Media reports suggest 19 of 26 chapters of the trade agreement have been completed so far but nothing has been confirmed officially. The UK Trade Secretary Kemi Badenoch has stated that completing the UK-India FTA this year is one of her top five priorities. Media reports suggest Rishi Sunak was planning a visit to India in October to sign off the deal though it may also get delayed. India is keen to make strategic links with other G20 members in a turbulent world and has an industrial policy focused on raising exports; it has recently agreed to a spate of trade agreements such as those with Australia and the UAE and has a number of other open FTA negotiations, such as those with the EU which were previously suspended in 2013.
Despite the importance of the deal, the 12 rounds of negotiations and 18 months that have passed since negotiations launched, it is not clear what has been discussed, what provisions the FTA will contain and what its implications could be. There are some indications of disagreements regarding tariffs for British cars and whiskey, immigration visas for Indian workers and international property rights which are slowing down progress in the negotiations. There are also the leaked Intellectual Property (IP) rights provisions, which are assumed to be the UK’s objectives that were circulated at the end of 2022, and which were widely condemned for their implications for affordable medicine production by a number of civil society organisations including Médecins Sans Frontières. Joint outcome statements after each round of negotiations include nothing of substance.
This lack of transparency is a hallmark of the UK’s approach to trade as well as development and UK aid as Bond has highlighted before. UK civil society is excluded from the process and is so concerned about the lack of engagement on environmental issues, that it has launched legal action against the government, arguing it has failed to uphold the Aarhus convention. In addition, UK members of Parliament have very limited opportunities to scrutinise the emerging deal. There was no discussion or vote on the agreement’s negotiating objectives and there is no guarantee of a Parliamentary debate or vote on the deal once it has been signed. This doesn’t need to be the way – for example, in the US, Congress provides its executive branch with the negotiating mandate, and members of Congress can request briefings during negotiations covering classified materials.
Aside from this worrying level of opacity around the UK – India FTA, there has been recent coverage of a potential conflict of interest emerging at the highest levels of government, something which the current system of UK scrutiny is unfit to properly interrogate.
Is the PM even bothered about net zero and the SDGs?
Whilst Rishi Sunak is attending the G20 summit, he is not planning on attending the 2023 UN SDG Summit in mid-September. This is despite calls from over a hundred UK organisations urging him to attend, demonstrating his genuine commitment to sustainability. The UK’s historic responsibility to support the creation of a more sustainable global economic system and address the root causes of poverty, inequality and climate change does not seem to be among his priorities and is overshadowed by his business and economic growth-minded approach to international partnerships. From a champion of SDGs back in 2015, the UK has become a tokenistic actor lending support in words, but not actions.
It is yet to be seen if the commitment in the 2023 G20 trade and investment ministers communique to develop a “fair, open, inclusive, equitable, sustainable and transparent multilateral trading system” will be reflected in the final terms of a trade deal. This deal should not just be about higher trade volumes between the two nations, but also about responsible and sustainable trade which includes the protection of human rights, active decarbonisation, protection of biodiversity, support for just transition and other such vital issues. There is no indication that the UK is proactively aiming to ensure that its trade deal with India meets its existing international commitments on important issues like climate change, sustainable development and human rights. Rather than committing to a carbon-neutral FTA, the UK’s impact assessment of the FTA predicts an increase in greenhouse gas emissions as a result of the deal and does not explain how this will be mitigated. The UK’s published objectives for the UK-India FTA make no reference to sustainable development, and the SDGs are mentioned only once, in a footnote.
Another approach is possible
As Rishi Sunak makes his way to New Delhi for the G20 summit, the UK urgently needs to reconsider its approach to FTAs and trade policy more generally. The multilateral trading system is set up to take precedence over all other international commitments – while the terms of FTAs are legally binding, other agreements like the Paris Agreement are voluntary commitments. The UK needs to correct this imbalance and set out a progressive vision that is compatible with the UK’s commitments on a range of issues including reaching net zero emissions, gender equality and balancing civil society concerns alongside business interests. This requires large-scale reform to the engagement and scrutiny process overall, with improvements such as more comprehensive ex-ante impact assessments, an inclusive and comprehensive trade strategy and a compulsory role for the public and civil society.
Lastly, on the UK-India deal specifically, the UK should radically change its approach and put sustainable development at its heart, as set out in the Trade Justice Movement’s report on the topic published last year. This would show that the commitments Kemi Badenoch made in the latest G20 trade communique are sincere and set an example for other G20 nations to follow.
This blog was originally posted on the Bond website on 8 September 2023. Written by George Holt, Senior Researcher at the Trade Justice Movement and Sandra Martinsone, Project Manager at Bond.
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Image: The Prime Minister Rishi Sunak attends the G20. Picture by Simon Walker, No 10 Downing Street (CC BY-NC-ND 2.0)
