WATCH: Jonathan Reynolds HITS BACK at claims UK-India trade deal 'betrays British workers'
May 7, 2025
Business Secretary Jonathan Reynolds faced intense questioning on GB News yesterday over the newly unveiled UK-India trade deal.The questioning came after accusations that the deal creates a "two-tier tax system" that "betrays British workers."READ THE FULL STORY HERE
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0:00
Good morning to you, Mr Reynolds. And let's stay on India-Pakistan, shall we, on that escalating
0:05
tension between the two countries, obviously very concerning. Were you aware of India's
0:09
plans to strike Pakistan? No, they don't share that kind of information with us. You'll understand we've been monitoring
0:19
the situation after the appalling terrorist attack in Kashmir some days ago and might have
0:25
anticipated some kind of response, but we wouldn't expect the details of that to be shared with us, no
0:30
Could you share the details of the trade deal with the Secretary of State
0:35
I want to understand it. I'm just not sure I see the full benefits of it
0:41
Could you explain to me why we're doing or why you believe we're doing so well out of this
0:47
I could and I'm delighted to. So this is a massive deal that will benefit every part of the UK
0:54
It's the biggest trade deal we've done since Brexit. It's the best trade deal India has ever offered anybody
1:01
India is obviously a major economy, but it's growing so fast. It's the fastest growing major economy
1:06
And some examples of how this will benefit every part of the UK. So India is the biggest whiskey market in the world
1:12
We're pretty good at making that. The tariff at the minute is 150%. That halves immediately, then it falls to 40% in time
1:18
On electric vehicles, again, something we're very good at making, 110% tariff becomes 10% over time for the high-end vehicles that we specialise in
1:26
For lamb and salmon, iconic British products, it's a 33% tariff, and that goes to zero
1:32
And for services, even more exciting. So we get access to something no other country in the world has access to
1:38
which is Indian government procurement worth nearly £40 billion a year. Our own businesses can compete alongside domestic businesses in India
1:46
So for every part of the UK this means more growth higher wages more jobs more tax revenue exactly the kind of things that will make a difference to people lives and make them better off It has emerged though that Indian nationals that are moving here will no longer need to pay
2:01
national insurance contributions for three years. So you have been accused of two-tier tax
2:07
for Indian migrants. Are you betraying British workers with this deal? no absolutely not and i'm delighted to be able to clear this up unequivocally so let's be clear
2:20
if you were an indian national in the uk and you applied for a job and a british person applied for
2:24
the same job you pay exactly the same tax this is a very specific situation that we already have
2:30
for 50 other countries where if you are an indian national temporarily seconded to the uk
2:36
or a uk national temporarily seconded to india you don't pay both countries tax systems if you're
2:42
a UK citizen, you pay into ours. If you're an Indian national, you pay into theirs. It
2:46
just makes it easier to move people between companies for a short period of time. But we
2:51
would never do any deal that undercuts British workers that leads to any sort of two-tier
2:55
tax system. I say again, we have this with 50 other countries, and I don't hear many
3:00
complaints about that. I think what this is about, frankly, is people not being able to
3:04
accept this is a major benefit. Well, the biggest trade deal we've done, as I say, since Brexit
3:09
that everyone's going to benefit. We should all be getting behind this, these things that we can do together
3:14
to make every bit of the UK better off. But for British businesses with no national insurance
3:19
it's going to be cheaper, isn't it, to hire Indian workers rather than British workers
3:25
And this is at a time when the Labour government is obviously trying to get more people into work
3:29
It just seems counterintuitive, doesn't it? No, it wouldn't be the case
3:34
Just again, I say no-one is being undercut by an arrangement of this kind. It means our people pay our tax system Indian nationals pay theirs if they temporarily for business mobility purposes seconded to each other country If you were recruiting someone you pay the same taxes that are on it
3:49
Of course, even if you were transferring someone within a business, a multinational, to the UK
3:54
you still have to pay the NHS surcharge, you still have to pay the higher costs of relocating people
3:58
and it's only temporary. If you want long-term staff, you've got to recruit them in the UK and pay that
4:03
I say again, there is no impact whatsoever on the immigration system from this deal
4:07
No changes to the points-based immigration system. There are no guarantees of post-study visas that was in the public domain at one point as an ask
4:15
There's no changes in terms of visas for healthcare workers. There's a very modest change where a capped number of yoga teachers can apply for an existing visa in a way they couldn't before
4:24
I don't think we're going to be swamped, frankly, by Indian yoga instructors as a result of this
4:29
It doesn't impact the immigration system. It does impact jobs, growth, wages in every part of the UK
4:35
with a particular benefit for Scotland, the north of England and the Midlands
4:39
It's frankly exactly what we need. How are you going to deal with people who are overstaying their visas, though
4:44
Because the last set of data that we have, which is actually from 2020, from the Home Office, Indian nationals were the largest group of overstayers
4:51
by nationality at the time and concerned that that is still the case. Well, the point about people overstaying their visas and becoming illegal migrants
5:01
rather than part of legal migration is a massive issue. You've seen a significant increase, actually, in deportations of people overstaying since the change of government
5:10
The Home Office cracking on with that job. So you're right to say you cannot allow a situation where legal migrants become illegal migrants
5:17
But the kind of people we're talking about, highly skilled people coming for short-term business mobility
5:22
to be frank, that is not the problem I think we're talking about in this area
5:26
I think what we have to do more broadly is bring the immigration numbers down. They come down a fifth since the change of government but they still too high and we got to think about who is coming We got a lot of low people relatively coming to the UK I welcome talent coming to the UK but we got to orientate that much more
5:41
to the highly skilled sectors that we need, and that is part of our plans as a government
5:47
But totally recognise public concern is high on immigration. What we inherited is not a good situation or a sustainable one
5:52
We've got to bring those numbers down in a way that works with business. That's exactly what we're doing
5:56
And Jonathan, when would we begin to see changes being implemented because of this agreement? How soon would that be
6:06
Yeah, look, it takes about a year, 12 months on either side
6:12
to put fully in place the measures that the trade deal covers. That's because we've got to put through Parliament here
6:17
the changes in our tariffs. We'll have, for instance, cheaper clothing, cheaper footwear from India
6:22
as part of things that we have offered to India but benefit our consumers. And the same on the Indian side. Slightly different system there
6:28
And then for some of the tariffs, so if you take that whisky tariff, it halves immediately, and then there is a process of a time
6:34
where it goes down from 75%, the half rate, to 40%. Some things are removed immediately
6:40
The salmon and lamb tariff is removed immediately, access to procurement. So as soon as we implement the deal on either side
6:46
you start to get some of those benefits. We will see, for instance, immediately on ratification
6:50
a reduction in our tariffs paid to India of about £400 million
6:54
That rises to over £900 million over 10 years. India gets slightly less from that
6:59
because our tariffs are already lower. That's why they're seeing some other parts of the deal
7:03
to make sure it's fair and balanced. But look, good trade deals are good for both sides
7:07
This is great for the UK, for every bit of the UK, but I think it is good for both sides
7:11
Again, something we absolutely should celebrate and need more of. Well, look, great to see you so enthusiastic about this
7:17
I hope it lives up to everything that you think it will. And I appreciate your time this morning
7:23
We've got to leave it there. Thank you very much. Thank you
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