Expert Speak Raisina Debates
Published on Jun 13, 2017
May's election gamble backfires: Implications for India

Elections, like the game of cricket, are quite unpredictable. It is extremely difficult, if not impossible, to call the results of either with a fair degree of accuracy. This has been demonstrated in several cases in a stunning manner over the last one year.

Exactly a year ago, a huge shock was delivered to David Cameron, the then Prime Minister of UK when his decision to have a referendum on Britain’s exit from the European Union delivered the most unexpected result, albeit by a small margin. This was followed by the equally unexpected outcome of the US presidential election when the much fancied and highly experienced Hillary Clinton had to taste defeat at the hands of a novice, capricious, fickle and temperamental business tycoon Donald Trump who romped home handsomely in number of electoral college votes though not in terms of popular votes. Hardly any media analysts and commentators in USA and the world had given him any hope of winning.

Both these results were seen as decisions of the electorate against globalisation and in favour of protectionism and isolationism.

Why the election?

Theresa May became the 76th Prime Minster of the UK in July last year on Cameron’s resignation following the Brexit referendum. May was a Eurosceptic who had campaigned, though not enthusiastically, for the ''Remain'' stand.

 Although she herself was a supporter of the ''Remain'' camp, she vowed that she would carry out the verdict of the people to exit from Europe in letter and in spirit. She announced that she would negotiate a ‘’hard Brexit’’ which would emphatically sever ties with Europe but would try to get as much access as possible to the European market for British goods, services and investment. EU member states disabused her of this notion and made it clear that UK must allow freedom of movement of persons if it wanted access to the single market.

In a post-Brexit statement, the heads of 27 EU states said: “Access to the single market requires acceptance of all four freedoms.” European Council President Donald Tusk echoed this sentiment and said there would be "no free-trade agreement" with Britain without free movement of people.

May gave formal notice for commencement of Brexit negotiations on March 29, 2017 with Labour Leader Jeremy Corbyn stating that the government will be held accountable at every stage of the Talks. UK has two years in which to complete the negotiations.

Although May had promised not to call early elections before 2020 which is the date when life of current Parliament would end, she went back on her commitment as she was finding herself hobbled in taking forward the discussions with EU on this critical issue. She was persuaded by her advisers to call for a snap election because of her positive and healthy popularity ratings which would help her to improve her numbers in the House of Commons and enable her to negotiate from a position of strength with EU. Her declared reason was that with official Brexit talks due to start in mid-June, Labour, the Scottish National Party and the Liberal Democrats would try to destabilise and frustrate the process in Parliament. When she announced the election she was running a good 20 points ahead of her opponents. However within less than 2 months, all the advantage melted away.

Causes for the debacle

Several reasons can be advanced for the miserable performance by the Tories. Most importantly, Theresa May proved to be a poor and lacklustre campaigner. She was not able to connect with the people at the hustings. She committed several gaffes on policy issues, particularly on ways to generate additional resources for social spending in the srea of healthcare, education, social welfare etc. It is likely that the two terrorist attacks – one in Manchester and the other in London, also swayed the electorate as she had served as the Home Secretary of the country for six years during which she had reduced the number of policemen by 20,000 personnel. Her refusal to engage with her opponents in TV debates  did not help her. In comparison her opponent Jeremy Corbyn, the Labour leader who had been written off some time ago appeared calm and avuncular on the election trail and was able to make a remarkable comeback. Ironically Brexit was not an issue that received much attention during electioneering. The results would appear to suggest that it was a vote to somewhat correct the verdict delivered on this issue last year.

Theresa May has emerged from the election much weaker and considerably diminished. She has been able to obtain the Queen’s concurrence for forming a government. It is however anybody’s guess as to how long she will be able to continue. Results have proved the lack of soundness of her judgment. She will find opposition to her within her own party as well as from the Labour much more strident and aggressive. She has decided to continue as the Prime Minister as she maintains that Britain needs stability. It is a moot point how long this stability will last. She has joined hands with the Democratic Unionist Party from Northern Ireland who would have extracted a heavy price from her.

May has vowed that Brexit negotiations which were due to commence on  June 19 will not be postponed and will continue as scheduled. She will be going to the negotiations in a more vulnerable position and will be able to carve out a comparatively poorer deal than she would have been able to if she had not been reckless and rash in calling for early elections. It is quite likely that UK will go to the polls once again before the year is out.

Implications for India

May’s continuation as Prime Minister, at least for the time being, would mean that she would continue with her tough stand on immigration. This appears all the more probable because of the spate of terrorist attacks that took place in the country in recent weeks.

May had visited India in November, 2016 at the head of a large delegation soon after becoming Prime Minster. Preliminary discussions on a proposed Free Trade Agreement were held although it was well known that UK would not be able to commence formal negotiations for an FTA with any of its partners till the Brexit Talks with EU are concluded. Hopes, that in the interim, better visa facilities and arrangements for Indian visitors, businessmen, students, scholars, academics, tourists etc would be made available did not materialise. On the contrary, visa fees for Indians was increased while May was in India. Currently provisions under which visits of Indians are governed are worse than those of several others including the Chinese.

UK has traditionally been a gateway for Indian companies for Europe. Most Indian companies use their businesses in U.K. as launch pads to access the European market in goods and services. Indian companies have more than 800 subsidiaries in U.K. which generate billions of dollars in revenue annually and employ more than 110,000 people, according to a London-based consulting firm. A hard Brexit of the nature that May has in mind would mean that local companies would not be able to enjoy benefits of free trade within Europe and would be required to pay higher tariffs making their products less competitive. They will need to look seriously at establishing manufacturing bases and service platforms on the continent. Both Germany and France appear to be attractive centers with Germany enjoying an edge not only because of the positive rapport between Prime Minister Modi and Chancellor Angela Merkel but also because Germany can help India in moving rapidly up the manufacturing ladder and supporting several of Indian government's flagship initiatives like Make in India, Skill India, Start Up India, Smart Cities etc.

Last year India was the third largest source of foreign direct investment in UK after USA and France. Indian investment in UK is greater than India’s investment in the rest of Europe combined.

A hard Brexit implying a clean break up with EU might enhance the interest of Britain to have stronger trade ties with India. On the other hand, such a scenario could weaken India’s interest as UK would have lost its attractiveness as an entrepot to Europe.

In the short term the UK election results will not have much of an impact on relations with India. It is a matter of satisfaction that the highest number ever of Indian origin British citizens - 12 - has been elected to the House of Commons. It could imply that in the coming years more serious attention will be paid to India, and India’s interests will be promoted more pro-actively. India will however need to continue to carefully watch the situation for any significant change in the political configuration in UK.

The views expressed above belong to the author(s). ORF research and analyses now available on Telegram! Click here to access our curated content — blogs, longforms and interviews.


Ashok Sajjanhar

Ashok Sajjanhar

Amb. Ashok Sajjanhar has worked for the Indian Foreign Service for over three decades. He was the ambassador of India to Kazakhstan Sweden and Latvia ...

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