India’s High Commissioner has hit back at claims Sir Keir Starmer has implemented a two-tier tax system as part of a trade agreement with the South Asia country.
Speaking on GB News, Vikram K. Doraiswami provided clarity as to why the change was vital for the deal to be struck.
The Labour Government has been criticised for its decision to exempt Indians who move their jobs to the UK and their employers from paying National Insurance for three years.
Ex-Prime Minister Boris Johnson revealed to GB News yesterday that India made the same demand while he was in office, but he thought they were "winding him up".
Doraiswami says the trade deal is fair for both British and Indian workers
GB NEWS / PA
Doraiswami sought to clear up any potential confusion surrounding the agreement and insisted the change was a “matter of fairness”.
He told Martin Daubney: “This is a reciprocal arrangement that has been on the table for the last couple of years in negotiations.
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The UK and India have signed a landmark trade deal PA “We sought to finalise this separate from the trade deal but it has come through together.
“I would like to emphasise three points to your viewers - one, it’s a matter of fairness. People who pay to their pension pots in India or in the UK, working in each other’s country, are currently being asked to pay twice.
“If GB News, for instance, opened a studio in India, your journalists would be paying back to their pension pots in both the UK and India.
“This expands the existing relief for all expat workers off one year to a further two years, no more than that. This is no more than what you are offering another 50 countries anyway.
Doraiswami joined Martin Daubney on GB News
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“Beyond that, there is another fairness point about a fair number of our people who come here on short term work visas for Indian companies providing services here - what you get is a process where they pay into a pension pot here and they have to leave at the end of their contracts and they can’t withdraw that money.
“Essentially, you’re asking people from a comparatively lower wage economy to subsidise yours. Surely you would agree that’s unfair?”
The deal, which will come into effect within a year, will lower tariffs for Indian imports on a range of British goods.
These include gin and whisky, aerospace products, electrical and medical devices, cosmetics, lamb, salmon, chocolates, biscuits, and high-value cars.
British consumers will benefit from reduced tariffs on Indian exports including clothing and footwear, cars, foodstuffs such as frozen prawns, jewellery and gems.
The agreement also includes provisions on the services sector and procurement.
This will allow British firms to compete for more contracts in India.
The deal is structured to benefit both nations, with India gaining increased foreign investments and Britain securing a foothold in India's expanding market.
Notably, the agreement does not include any changes to immigration policy, including for Indian students studying in the UK.
