Brexit Bulletin: May’s Passage to India

Friction with India bodes ill for post-Brexit Britain

May's India Visit Begins With Modi Migration Clash

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Prime Minister Theresa May flew to India on Sunday, perhaps hoping to escape a week of domestic setbacks marked by the High Court ruling that she lacks the power to begin Brexit negotiations alone. 

She may have been disappointed by the welcome. With the number of Indian enrolments at British universities falling 50 percent, Indian PM Narendra Modi used the visit to call on the U.K. to support more student visas.

Theresa May and Liam Fox head on a trade mission to India (Sunday November 6, 2016)

The U.K. hopes relations with India can be a model for the kind of trade deal possible in a post-Brexit environment

Photographer: Dan Kitwood/Getty Images

 May told reporters traveling with her, including Bloomberg's Tim Ross, that the limits on non-European Union citizens entering Britain were working well. She said she plans to announce a "bespoke" fast-track visa service for "high net-worth" Indians.

The trade mission is aimed at boosting links with India for when the U.K. leaves the EU, although the migration row could be a sign of the difficulties that lie ahead for May. She is prioritising control of Britain's borders, yet that risks antagonising countries she needs as her trade and investment partners.

Davis in Parliament 

In her first comments since three judges said Parliament must decide when to start two years of Brexit talks, May wrote in the Sunday Telegraph that she won't be obstructed by judges or lawmakers. She said the negotiations will still begin by the end of March and that her government has a strong legal case to make when the Supreme Court hears the appeal.

Brexit Secretary David Davis will lead the counter-offensive in the House of Commons today. Bloomberg's Svenja O'Donnell reported on Friday that Davis and Chancellor of the Exchequer Philip Hammond are now working on a common Brexit plan after putting ideological differences aside.

The Times today reports that ministers are considering plans to fast-track Brexit approval through Parliament if the Supreme Court upholds the ruling. Using a resolution rather than a full bill would allow it to be approved in both houses of Parliament in one day.

Weekend Wrap

There was more fallout over the weekend after Friday's newspaper coverage of the High Court decision, which saw the Daily Telegraph, Daily Mail and others attack the judges.

Gina Miller, one of those who took the government to court, told the BBC that the press had "behaved, in my view, disgracefully." The Bar Council said it "condemns" the criticism.

May said independent judges and a free press are "important," while Lord Chancellor Liz Truss said Court independence is "the foundation upon which our rule of law is built." Truss, whose governmental role includes oversight of the judiciary, had been criticized for not immediately defending the judges.

Reinforcing the vitriol of recent days, U.K. Independence Party interim leader Nigel Farage warned "of a political anger the likes of which none of us in our lifetimes have ever witnessed in this country" if politicans try to delay Brexit.

Opposition leader Jeremy Corbyn said May must meet his "Brexit bottom line," including access to the single market and no dilution of workplace rules. Still, Deputy Leader Tom Watson denied the party would block Brexit. 

Health Secretary Jeremy Hunt said May could call a general election although he noted that was "the last thing that the government wants."

Brexit Bullets 

  • Ryanair's O'Leary says he's pessimistic on Brexit talks, and it's becoming clear U.K. can't keep EU trade benefits
  • Business confidence remains negative, says Institute for Chartered Accountants
  • Manufacturers expect spending to decline amid weak demand
  • CBI says companies to boost expansion before Brexit fallout hits
  • Endeavour Mining to move HQ from Paris to London, says Sunday Telegraph
  • Birds Eye to raise food prices, says Sunday Times
  • EU reconsiders financial market access rules, FT reports
  • European Commssion's competition arm asks for details of Nissan deal

 On the Markets

 The pound's most accurate forecaster reckons the currency's best week since 2009 was just a blip. Sterling surged last week after the court ruling, yet Svenska Handelsbanken predicts an almost 3 percent drop to $1.22 by the end of March.

"Political uncertainty will stay," says Claes Mahlen, head of trading strategy at the bank.

And for those of you who remember the atmosphere on the markets on the morning after the Brexit vote, here's a handy guide on why it's sensible not to panic at whatever the stock market does after tomorrow's U.S. presidential election.

And Finally

Ireland is describing Dublin as "Canary Dwarf" as it tries to lure bankers from the U.K., according to Allied Irish Banks Chairman Richard Pym. The reference is, of course, to London’s Canary Wharf, where banks including JPMorgan and HSBC have operations.

Ireland is in a “unique position to benefit from Britain’s folly,” Pym, an English banker who opposed Brexit, said at a conference on Friday.

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