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Make concessions on Indian immigration if you want a trade deal, PM May told.

Hangzhou (China): Prime Minister Narendra Modi meeting the Prime Minister of United Kingdom (UK) Theresa May, on the sidelines of G20 Summit 2016, in Hangzhou, China on Sept 05, 2016. (Photo: IANS/PIB)

UK Prime Minister Theresa May’s bid to seal a trade deal with one of the world’s largest economies suffered a major blow on Sunday after a senior Indian government official said Britain needed to make concessions on immigration.

Mrs May wants to use her first bilateral trade trip since taking office to try to boost ties with India before leaving the European Union.

May’s office said the visit starting on Sunday night would focus on breaking down barriers to trade and investment and paving the way for a free trade deal as soon as possible after Brexit.

However Indian government spokesman, Vikas Swarup, told Britain’s Observer newspaper that Mrs May faced tough questions on immigration and conditions for Indian students and workers in the UK.

“Indian students and people-to-people relations are important pillars of India-UK ties,” he said.

“In the last five years or so, the number of Indian students enrolling in UK universities has gone down by almost 50%; from around 40,000 to about 20,000 now.  This has happened because of restrictions on post-study stay in the UK.

“We will continue to raise our concerns regarding mobility with the UK. Mobility of people is closely linked to free flow of finance, goods and services.”

Mrs May has said that “India matters now more than ever” as it is the “fastest growing major economy”.

She said the trip was about seizing the opportunities of Brexit and “expanding our horizons and forging stronger partnerships with countries around the world”.

“This is a partnership about our shared security and shared prosperity. It is a partnership of potential. And on this visit I intend to harness that potential, rebooting an age-old relationship,” she said in a statement ahead of the visit.
While Britain cannot sign trade deals with third countries until it is outside the EU, the government is keen to hold preparatory discussions.

But any potential trade deal may hinge on what concessions Britain is prepared to make in terms of immigration.

Mrs May was accused of unfairly targeting migrants from outside the European Union – especially foreign students – when she was Home Secretary as the Conservative government tried to clamp down on net migration.

In 2010 Mrs May scrapped the post-study work visa, which allowed foreign students a two-year work permit in the UK after completing a course at a British university.

Indian students now find it difficult even to get internships or part-time work while they study in the UK.

In 2013 Mrs May tried to introduce a controversial “visa bond” scheme for foreign students from six African and Asian countries, of which India was the biggest, to prevent “high-risk” students staying in the UK after their work permits expired.

The scheme, which was not introduced in the end, caused widespread outrage among the Indian Diaspora.

On her trip, Mrs May will be accompanied by trade ministers Liam Fox and Greg Hands and around 40 business representatives mainly from small- and medium-sized technology and healthcare firms.

She is scheduled to address a technology summit, have a working lunch with Indian Prime Minister Narendra Modi and meet businesses.

May will visit New Delhi and outsourcing hub Bengaluru before leaving on Tuesday.

Her office said commercial deals to be signed during the trip were expected to create a total of 1,370 jobs in the UK.

May and Modi will also launch a partnership on smart cities and urban development which could generate business worth up to 2 billion pounds for British firms over the next five years, her office said.

Britain will press India to allow its law firms to operate there, and will also offer its government expertise in areas such as deregulation and tax to help make India a more attractive business environment.

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