We need 50 India trade deals to make up for Brexit

That’s quite amazing when you think about it. India is a country that we ran within living memory; its lingua franca is English, its legal system is based on our own, it was the Jewel in the Crown of the British Empire

We traded with it for centuries thanks to a virtual monopoly, we helped build its infrastructure, and we have close family ties. There are millions of British citizens, many of them high achieving entrepreneurs, whose families come from India.

And yet we only do 2% of our trade with the country with a population of 1.4 billion.

The simple reason as anyone who is not a Brexit loon will tell you is that India is a long way away, and the gravity theory of international trade shows beyond doubt that the nearer you are to a country the more you are likely to trade with it. 

Which is why the new free trade deal we have signed with India is nice, but in terms of economics pretty irrelevant. They are going to reduce tariffs on Scotch whisky to a mere 75%, hurrah. We are going to let more Indian jewellery into the UK. It is not earth-shattering stuff.

India is the deal that the Brexiteers dreamed of when they fooled us into leaving the EU. They somehow thought that we could replace a brilliant open market across the continent of Europe with a few trade deals with countries on the other side of the world and prosper as a result.

To believe that you had to literally ignore simple stats and mathematics, such as the fact that the UK’s trade with Ireland (population five million) is more than double its trade with India. Most people just ignored stuff like this in a quest for sovereignty and an extra £350m a week for the NHS.

The government, which is trying to spin this deal as much as it can, says this is a game-changer, that it shows the UK is open for business, that it sends signals to the rest of the world. All the usual guff. 

But the UK government’s own calculations are that this deal will boost our economy by a staggering 0.1% a year eventually.

We also know that the government’s own calculations show that Brexit is costing the UK 5% of its economy a year now. 

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Which means that another 49 deals like this one and we will have offset the damage caused by Brexit – we’ll not be any better off but we will have offset the damage. 

The only small fly in that ointment is that there aren’t another 49 countries in the world as large as India.

Just remember 40 is 20 times bigger than two, and you will have a balanced idea of this deal’s true worth.