Trade deal with Indian could be a double-edged sword for Sunak | Rishi Sunak

With a general election not far away and the economy still struggling, Rishi Sunak is on the hunt for good news. Next month he will be in New Delhi for the G20 summit – a visit that will be unusually rich with picture opportunities and chances to strike deals. Sunak’s parents are of Indian Punjabi descent and his wife, Akshata Murthy, is a hugely wealthy Indian businesswoman, fashion designer and venture capitalist. In many ways it will be a homecoming for the first Asian couple ever to occupy No 10.

Sunak’s business and trade secretary, Kemi Badenoch, has been in India over the past few days, laying the ground for a string of announcements with her G20 counterparts. Inevitably, much of the talk in UK and Indian diplomatic, business and trade circles has been about the possibility of a post-Brexit trade deal between the UK and India. The two governments had hoped to conclude one last autumn but negotiations have dragged on.

Agreement between the world’s fifth and sixth biggest economies (India and the UK respectively) to reduce tariffs on UK exports such as Scotch whisky and cars, and increase still further access for Indian workers to the UK, would be a big deal for Sunak. But there are issues worrying Downing Street. India already tops the list of nations sending citizens to the UK. Between June 2022 and June 2023, the number of Indian health and care workers entering the UK leapt by 81% from 18,570 to 33,669. Indians also topped other categories.

While Brexiters in Sunak’s party desperately want evidence that “global Britain” is real, they may not be thrilled to see that the flipside of liberalised post-EU trading arrangements means replacing EU workers with others from farther afield.

There is, though, another fear nagging away inside No 10 and the Foreign Office. In return for lowering tariffs on UK exports to Indian markets, Delhi is asking for more visas for skilled workers such as IT professionals who work for Indian technology companies that have invested in Britain. India also wants improved access for young Indians to the UK.

One of the main companies with an interest in securing more temporary visas to the UK is Infosys – the huge global leader in digital services and consulting co-founded by Akshata Murthy’s father NR Narayana Murthy. Although Akshata has only a 0.93% holding in the company, it is still worth £481.2m and accounted for the vast majority of the Sunak family’s wealth when the Sunday Times published its 2023 Rich List in May.

Shivendra Singh, vice-president and head of global trade at Nasscom, the IT industry body, said: “New-age technology such as generative AI, blockchain and machine learning have widened the demand-supply gap. We want to make it easier for IT workers to go to Britain to fill the gap on projects and then come back. They will go and return. This does not affect net migration at all.”

Infosys applied for 2,500 visas for the UK in 2019, primarily so that it could bring in its staff to work on large outsourced IT contracts in the country. Being such a large enterprise, the company has the ear of the Indian government.

The problem for Sunak is that a UK-India trade deal, if struck, is likely to be of considerable financial further benefit to the company in which his own wife already has a very large financial interest.

Questions about a conflict of interest are already being asked. What should the Sunaks do? “This is what No 10 has worried about for some time,” said one source aware of thinking at the top of government on the issue.

“There’s a lot of concern about perception, what it would look like to people – a worry that, one day, someone will join the dots.”