India-UK FTA Deal: How Rishi Sunak’s 'Internal Matter’ Became National Interest

The UK media contends Infosys stands to benefit from the trade agreement which in turn, benefits Murthy's family.

While India gears up to hold the G20 Summit on 9 and 10 September 2023, partly driven by the ruling Bharatiya Janata Party's (BJP's) electoral interests, making it a larger-than-life show, for the average Indian in the capital New Delhi, the event will mean roadblocks and traffic restrictions.

Meanwhile, the United Kingdom’s Prime Minister Rishi Sunak is faced with roadblocks of his own making before he heads to India for the Summit.

Hindu supremacists, on 15 August, lauded and praised Sunak’s Hindu faith as he attended the Ram Katha by Indian religious preacher Morari Bapu at Cambridge University’s Jesus College, but this time, it is his wealth which has once again created a controversy.

Most Britons – six out of 10- do not care about religion in politics, but about integrity and wealth, something the Conservative Party, over the last few years has misused and created angst among voters.

India-UK FTA Deal 

In fact, Professor Chakravarthi Ram-Prasad of Lancaster University, has been quoted saying, “As far as being a Hindu, I’m not sure whether this has any great bearing on the kinds of crises confronting this country, nor do I think it will have any impact on … relationships with India.”

He cautioned that Sunak should not be seen in any sense as a prime minister who would pursue policies in the name of Hinduism. Sunak is seen as a plutocrat, and it is his wealth that has drawn him into serious controversies.

Once again, Akshata Murthy, the UK’s first lady’s ownership of Infosys is in question, ahead of a free trade agreement that her husband, Rishi Sunak, is negotiating with India.

Kemi Badenoch, UK Trade Secretary may be gushing about the Free Trade Agreement (FTA) with India being in the "final stages”, but government insiders say a full trade agreement being struck in time for Rishi Sunak's first official visit to India in September for the G20 summit is unlikely, despite "passion on both sides".

At home in the UK, questions about the PM’s latest conflict of interest controversy cannot be side-stepped.

Conflict Of Interest 

At the weekend Labour, and the chair of the all-party House of Commons business and trade select committee, called for Sunak to be more open about his wife’s financial interests, given that Infosys could be a key beneficiary of any agreement.

One expert has reportedly said he should recuse himself from the trade negotiations altogether, according to The Guardian. Allegations of conflict of interest seem to follow Sunak wherever he goes.

The UK media contends that Infosys, which sees the UK as one of its biggest markets, with customers including the British government, stands to benefit from the trade agreement, which in turn, benefits Murthy’s family.

Reportedly, MPs and trade experts have raised concerns at the highest levels of government over potential "transparency” issues relating to his wife Akshata Murthy’s shareholding – worth almost £500m – in Infosys.

The Infosys Spin in Work Visas

The work visa issue is a sticking point in the FTA where India is demanding further leeway. However, Infosys, which has had contracts with the British government as well as many UK companies, "is known to want to improve access to this country for its many thousands of contract workers through changes to the UK visa regime," according to The Observer.

The report adds: "Allowing more visas for its workers in sectors such as IT and artificial intelligence is a key Indian demand in the talks over a free-trade agreement. The UK, for its part, is seeking reductions in the high tariffs on exports to India of goods including Scotch whisky and cars."

The software sector, for India, is its biggest export. Companies like Infosys and Tata Consultancy, have for long been, by far, the largest private sector users of the UK work visa system.

Darren Jones, the Labour chair of the business and trade select committee, said, “As the prime minister recently learned, it’s important he declares any interests properly. I expect him to do so in respect of the India trade deal too.” According to The Observer, such are the sensitivities over the negotiations and Sunak’s involvement, that the Foreign Office (FCDO) has warned Jones’s committee in the strongest terms against conducting a trip to India this autumn to examine issues around a potential deal.

Jones said, “The committee was advised by the government that it would be better to visit India next year instead of during sensitive trade negotiations.”

Reportedly, the FCDO has 'indicated to the committee that it will not be able to assist in setting up meetings for the MPs with Indian officials and businesspeople. Amid signs of tension between the MPs and the FCDO, the committee will meet soon after parliament returns to discuss whether to go ahead anyway,' according to The Observer.

Wife’s Shareholding Landed Sunak in Several Controversies

This is not the first controversy that Sunak faces. In March, he was questioned if he had declared his wife’s shares in a childcare company, to which his spokespeople said the PM had followed the rules “to the letter.”

However, the Standard Commissioner has now found that Akshata Murthy’s financial interest in Koru Kids should have been fully declared by the PM at the time.

Sunak is one of the richest MPs, but his wife’s shareholding in Infosys got the pair into trouble in 2022 also, after it emerged his wife was claiming non-dom status and Infosys continued its links with Russia despite its invasion of Ukraine.

It said Sunak had breached parliament’s code of conduct inadvertently. He has corrected that error, but until the weekend, the PM had not made public his wife’s 0.94% holding in Infosys in the register.

Among other controversies surrounding Sunak, was the revelation of his holding a US Green Card while serving as Chancellor of the Exchequer.

The latest controversy is unlikely to die down soon as questions are bound to fly when the Parliament reconvenes after the summer recess next week.

It is also unlikely that the Opposition will let go of the issue. The matter is internal, but one can only hope it will not cast a shadow on the FTA with India, which all political parties support and Labour leader Keir Starmer sees the UK-India trade deal “as a first step in a wider strategic partnership."

(Nabanita Sircar is a senior journalist based in London. She tweets at @sircarnabanita. This is an opinion piece and the views expressed above are the author’s own. The Quint neither endorses nor is responsible for the same.)