By Prof. Gulshan Sachdeva
Rishi Sunak’s top priority will be to get the UK’s economy back on track, and unite a badly-divided Conservative Party
We did not have a UK-India FTA on Diwali, as hoped by the then visiting British Prime Minister Boris Johnson earlier this year. But we do have an Indian-origin Prime Minister in 10 Downing Street now. Rishi Sunak’s ascent to power has generated a lot of interest in India. The UK’s youngest Prime Minister in 200 years is a practicing Hindu who earlier took oath on the Bhagwad Gita.
Despite being relatively new to British politics, he has played his cards well. Within a few years of becoming Member of Parliament, he was first appointed Chancellor of Exchequer, and now Prime Minister. This despite the fact that he is non-white and descendant of immigrants from India and East Africa.
Although the recent political turmoil within the Conservative Party, and economic difficulties have provided an opportunity for him to become British Prime Minister, this is certainly a huge achievement for British democracy. This does not mean racism is finished in Britain, or suddenly the United Kingdom has become a successful multicultural society. Still, this indicates further maturity in British politics, attitudes, and its democracy. This is not a small achievement. It also shows that merit and competence get rewarded in a free British society.
In his first speech as Prime Minister he highlighted that the country is “facing a profound economic crisis”. Further, the “aftermath of Covid still lingers” and "Putin's war in Ukraine has destabilised energy markets and supply chains the world over”. Without specifying details, he asserted that through “integrity, professionalism and accountability” he would bring “economic stability”, and fix some mistakes made by his predecessor.
Sunak is a technocrat, and showed his competence as a Chancellor of Exchequer during the pandemic. This is perhaps the reason he is chosen by his party. But the real challenge for him is political. As a leader he has to unite a badly-divided Conservative Party. Many members of the Boris Johnson Cabinet are back. Since Tories are in no mood to go for elections now, he has more than two years to provide economic stability, unite the party, and lead Tories in the next general elections.
His appointments may bring some calm in financial markets. But his political leadership to implement “hard economic decisions” to control inflation, and inject growth still needs to be demonstrated.
Despite some euphoria in India, Sunak’s impact on India-UK ties will be marginal at best. The bilateral ties are already on an upward trajectory. This momentum will continue. The comprehensive strategic partnership, Roadmap 2030, and British tilt towards the Indo-Pacific have already brought the two countries closer.
The most important deliverable expected is a bilateral FTA. Apart from agreements on many chapters, mobility of skilled Indians to the UK could be a sticky point. Another Indian-origin MP, Suella Braverman has been re-appointed as Home Secretary. She earlier branded Indians as the largest group of migrants who overstayed in the UK.
Sunak has also been an early backer of Brexit, wants more controls of its borders, and favours deporting of asylum seekers to Rwanda. So tough negotiations on mobility issue are expected under the Sunak administration. Although the UK’s economic conditions are not very favourable towards a new trade agreement, both sides feel that early FTA will help trade and investment in the coming years.
Internationally, Sunak will continue to follow the UK's role and responsibilities at the UNSC, NATO, G7, and G20. With his international exposure and background, he will have little difficulty in adjusting to this role. No change is expected in Britain’s prominent role in support of Ukraine.
At this point in history, Sunak has got an opportunity to prove his capability in stabilising the British economy. The markets would expect a detailed and credible tax rise, expenditure cut, and defence spending plan of action. The accumulated economic problems are the result of Brexit shocks, the pandemic, and the Ukraine war. Some of the issues can be tackled through domestic responses, but many issues need wider co-ordination within Europe and beyond.
Still, a limited economic stability can strengthen him politically within the Conservative Party’s rank and file. Tories are fast losing popularity. Sunak’s main job at the moment is to keep the party united so that it can avoid a general election which could prove disastrous for the Conservatives. The Brexit is done. But the Brexiters are now reluctant to go to electorates.
Originally published: Money Control, October 26, 2022.
Posted in SIS Blog with the authorization of the author.
Gulshan Sachdeva is Professor at the Centre for European Studies and Coordinator, Jean Monnet Centre of Excellence, Jawaharlal Nehru University.