Bilateral arrangements taking over multilateralism : FM Sitharaman
NEW DELHI : Countries are prioritising bilateral arrangements in an increasingly fragmented and multipolar world, Union Finance Minister Shri Nirmala Sitharaman said on Tuesday. However, she denied that the India-U.K. Trade negotiations were going to be sped up because of the tariffs announced by U.S. President Donald Trump, even as she was optimistic that the negotiations would be concluded “sooner rather than later”.
Ms. Sitharaman made the remarks during a moderated discussion on India’s development trajectory, with LSE Professor Nicholas Stern and BJP member and former bureaucrat N.K. Singh at the Indian High Commission in London. Ms. Sitharaman is in London for the 13th India-U.K. Economic and Financial Dialogue (EFD) with her counterpart, U.K. Chancellor Rachel Reeves.
The world was getting more multipolar, and that, along with the ineffectiveness of multilateral institutions, was driving countries to be more proactive with bilateral arrangements, Ms. Sitharaman said.
“Global uncertainties — the imponderables — are multiplying by the day,” she said, arguing that countries could not grapple with all of these and factor them into their policies. Therefore, she said, it was simpler and more effective to look at these challenges through a bilateral lens.
“And when bilateral arrangements are being made, you find that ideological or bloc-related affiliations no longer hold,” Ms. Sitharaman said.
“So bilateral arrangements for trade — or for any other reason — are catching up,” she said, adding that economic interests were now part of strategic interests. Bilateralism would be the way forward at least until multilateral institutions go through a revival and “speak with a certain voice”, she said.
The latest source of uncertainty in the world has been U.S. President Donald Trump’s April 2 announcement of tariffs. The U.K. and India face a 10% and 26% tariff, respectively, on their U.S. exports. U.K. Prime Minister Keir Starmer had described this as the start of a “new era” and not a short-term exercise.
Asked if the U.S. tariffs were creating momentum for the U.K. and India to conclude a trade deal, the Minister answered in the negative.
India and the U.K. had been negotiating a deal for “a long time “, she said, pointing to discussions the Modi government had held with the former (Conservative) U.K. governments.
“So it is not as if we are rushing into a U.K. FTA, because something has developed from the U.S. This was to happen a long time ago.” With the new Labour government in the U.K. also showing enthusiasm to conclude a deal, she hoped one could be agreed “sooner rather than later”.
Apart from the Dialogue with Ms. Reeves on Wednesday, Ms. Sitharaman has engagements with the City of London (the London local government that houses the city’s financial district) and its governmental head, the Lord Mayor of London.
During her visit, the Minister is making a pitch for GIFT City, the central business district in Ahmedabad, as a financial services centre in India. This was part of her discussions with the chief of insurance company Prudential PLC, Shriti Vadera, in London on Tuesday – the Finance Minister encouraged Prudential to explore opportunities in its International Financial Services Centre, in the GIFT City Special Economic Zone.
Other discussions as part of the Dialogue would include a bilateral investment agreement, which the U.K. and India have been discussing in parallel to a trade agreement, the mutual recognition of professional qualifications and cooperation in the education sphere, the Minister said.
The two sides are expected to discuss opportunities for U.K. universities to set up campuses in India and also look into enhancing the number of Indian students who were studying in the U.K.
India is also seeking to collaborate with U.K. research institutions, the Minister said. Some U.K. educational institutions – such as the University of Southampton – have already set up campuses in India under the National Education Policy (2020). Queen’s University Belfast has said it will offer courses in GIFT City next year and the University of Surrey is exploring options to set up a campus there next year, the Guardian reported.
While Indian students used to historically come to the U.K. to study, there had been a marked preference for the U.S. in recent years, with the U.K. losing momentum as a first choice for students.
“But that momentum will have to be regained,” Ms. Sitharaman said.
The Finance Minister will attend a dinner hosted by her U.K. counterpart, Chancellor of the Exchequer Rachel Reeves. U.K. Prime Minister Keir Starmer may attend the dinner.
Source : The Hindu