The India deal may prove a hard sell for Sir Keir
After three years of negotiations, Britain and India have at last agreed a trade deal. The UK will slash tariffs on imports from India and India will do the same for British exports, including whisky, cars, medical devices and much else.
The deal is good news for British consumers and exporters, a boost for free trade in an increasingly protectionist world, and a triumph for the Brexit vision of reorienting trade away from the stagnating European continent. The Remainer claim that we would be stuck behind Brussels in the queue for future deals has been discredited.
The problem for Sir Keir Starmer is that his woeful record on tax and migration will make it difficult for him to sell this deal to the public. One of the sticking points in negotiations had been the taxation of Indian workers temporarily posted to Britain by their employers. Yesterday's deal granted these workers an exemption from paying National Insurance contributions in the UK so long as they pay the equivalent tax in India.
Such an arrangement could have been sold as a sensible move to avoid workers being taxed twice and, indeed, Business Secretary Jonathan Reynolds attempted to portray it as such, noting that we already have 17 similar deals, including with the EU, US and South Korea.
On the heels of last Autumn's National Insurance raid, however, and concern over the volumes of both legal and illegal immigration, it is potentially politically toxic. Indeed, Conservative leader Kemi Badenoch has wasted no time in accusing Sir Keir of introducing a system of 'two-tier taxes', with his deal being portrayed by Reform and the Tories as granting tax cuts for some migrants, even as British workers face tax hikes.
Concerns are also being raised over the potential impact on migration. The Indian government's own statement announcing the deal claimed that it 'eases mobility' for Indian workers, and secures 'immense opportunities' for Indian youth in the UK. Mr Reynolds, however, asserted it would have 'no impact' on Britain's immigration system, besides a small number of workers accessing a visa capped at 1,800 per year. Given the Government's record, many will wish for more solid assurances that this deal does not amount to liberalisation of visa policy by the backdoor.
The economic benefits of this deal should have seen it welcomed by all quarters. It is a deep shame that Labour's dysfunction has overshadowed what may prove to be a great Brexit victory.
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