Starmer visits JLR as Trump’s tariffs hit UK car industry
Keir Starmer also announced a 20 per cent cut in any fines and said the money raised would be invested back into the British car industry.
Speaking to JLR workers, Starmer said the UK government would change course on its electric vehicle (EV) rules to support domestic carmakers. (Photo: X/@Keir_Starmer)
Vivek Mishra works as an Assistant Editor with Eastern Eye and has over 13 years of experience in journalism. His areas of interest include politics, international affairs, current events, and sports. With a background in newsroom operations and editorial planning, he has reported and edited stories on major national and global developments.
PRIME MINISTER Keir Starmer visited Jaguar Land Rover’s (JLR) headquarters in the West Midlands on Monday as the country’s largest carmaker, owned by Tata Motors, deals with the fallout of US president Donald Trump’s global trade tariffs.
The car industry is among the hardest hit, with a 25 per cent tariff imposed on imported vehicles. JLR recently said it would “pause” shipments to the US while it assesses the impact of the “new trading terms”.
Speaking to JLR workers, Starmer said the UK government would change course on its electric vehicle (EV) rules to support domestic carmakers. “I think EV targets are a good thing, they're good for the climate, good for business certainty and investment, good for British manufacturing,” said Starmer.
“But I accept that those targets have to work for British manufacturers and I don't want British firms like this one put in a position where you have to pay a hefty fine or buy credits from foreign EV companies. So today we're going to introduce much more flexibility into EV mandates, we're going to help companies based in Britain reach the targets in a way that supports growth,” he added.
He also announced a 20 per cent cut in any fines and said the money raised would be invested back into the British car industry. While acknowledging that tariffs are not welcomed, Starmer said the UK is ready for a phase of “industrial renewal”.
He said: “Nobody welcomes tariffs, we don't want to get into a trade war. Obviously, we will continue to talk to the US about a (trade) deal to alleviate the situation whilst keeping all options on the table, but what's important and in direct answer to your question is at a moment like this we have to shape our future, we have to step up.”
He added: “We can't be cowed and simply say there are things happening in a changing world which make it more difficult and therefore we retreat. This is the moment to seize the opportunity.”
Asked if the invitation to Donald Trump for a State Visit to the UK could be reconsidered, Starmer said: “It's not in our interest to simply rip up that relationship. We have to keep pragmatic and calm in the steps that we take, but we also need to keep a sense of perspective and context. We have to step up the challenges that tariffs undoubtedly put on the table to us.”
Starmer reiterated that any trade agreement with the US would be made only if it is in the UK’s national interest and right for security and working people.
In his speech, the prime minister also announced a government investment of up to GBP 600 million to create a new Health Data Research Service. The plan aims to provide a “secure single access point” to national-scale NHS datasets and cut red tape for researchers.
“Life sciences, like our brilliant car industry, is a great British success story. The measures I am announcing today will turbocharge medical research and deliver better patient care. I am determined to make Britain the best place in the world to invest in medical research,” Starmer said.
According to the Department for Science, Innovation and Technology (DSIT), the move is aimed at speeding up the discovery of life-saving drugs and improving patient care.
Clinical trials will be fast-tracked, with the time to set up trials cut to 150 days by March 2026. In 2022, the average time was over 250 days.
DSIT said this will be done by reducing bureaucracy, standardising contracts, and publishing trust-level data for the first time.
Workers are engaged at their sewing stations in a garment factory in Savar, on the outskirts of Dhaka, on April 9, 2025. (Photo by MUNIR UZ ZAMAN/AFP via Getty Images)
BANGLADESH, the world's second-biggest garment manufacturer, aims to strike a trade deal with the US before Donald Trump's punishing tariffs kick in next week, said the country's top commerce official.
Dhaka is proposing to buy Boeing planes and boost imports of US wheat, cotton and oil in a bid to reduce the trade deficit, which Trump used as the reason for imposing painful levies in his "Liberation Day" announcement.
"We have finalised a draft reciprocal trade agreement," Mahbubur Rahman said on Wednesday (3), adding the government was "hopeful of reaching a win-win agreement".
Rahman said a meeting between officials from both countries was slated for July 8, with the US representing 20 per cent of Bangladesh's ready-made garments exports.
Textile and garment production accounts for about 80 per cent of exports in Bangladesh and the industry has been rebuilding after it was hit hard in a student-led revolution that toppled the government last year.
Trump hit Bangladesh with 37 per cent tariffs in his April 2 announcement, which is more than double the 16 per cent already placed on cotton products.
He suspended the tolls' introduction until July 9, as he did with other global trading partners, though a baseline 10 per cent levy was kept in place.
Bangladesh exported $8.36 billion worth of goods to the US in 2024, while imports from there amounted to $2.21bn, according to the Bangladesh Bank and the National Board of Revenue.
"As part of the initiative to reduce the trade gap, the government already decided to import a large volume of wheat, purchasing 14 aircraft from US manufacturer Boeing, buying cotton and more oil and gas from the US farms," Rahman said.
He did not give further details on the exact timing or extent of the proposed deals, but said the government had held around 28 meetings and document exchanges in a bid to reach an agreement.
Interim leader Muhammed Yunus spoke to US secretary of state Marco Rubio on Monday (30) and told him Dhaka was "working with your officials to finalise a package of measures to effectively respond to president Trump's trade agenda".
Mahmud Hasan Khan, president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), the national platform of the garment makers, expressed concerns about any deal.
"The already enacted additional 10 per cent tariff is hitting our exporters, and if it goes further, we might lose US buyers," he warned.
But Mohammad Hatem, president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), said he was optimistic.
"We are hopeful of a positive outcome on the US tariff before July 9," he said.
"There will be a temporary problem if the US administration does not revise the tariff. But it will largely and ultimately hit the US buyers, as they would have to buy goods at higher prices."
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The Canary Wharf business district including global financial institutions in London.
THE COST of UK government borrowing fell on Thursday, partially reversing the rise seen after Chancellor Rachel Reeves became emotional during Prime Minister’s Questions.
The yield on 10-year government bonds dropped to 4.55 per cent, down from 4.61 per cent the previous day. The pound also recovered slightly to $1.3668 (around £1.00), though it did not regain all its earlier losses.
The movement followed comments from Prime Minister Sir Keir Starmer, who told BBC Radio 4's Political Thinking with Nick Robinson that he worked “in lockstep” with Reeves and said she was “doing an excellent job as chancellor.”
Analysts told the BBC that markets appeared to back Reeves, with concerns that her departure could lead to a weakening of fiscal discipline. “It looks to me like this is a rare example of financial markets actually enhancing the career prospects of a politician,” said Will Walker Arnott of Charles Stanley. “If the chancellor goes then any fiscal discipline would follow her out the door and that would mean bigger deficits.”
Mohamed El-Erian of Allianz warned that risk premiums may persist. “I suspect that we will see some moderation, but we will not go back to where we were 24 hours ago,” he said.
Reeves, who became tearful during PMQs after a U-turn on planned welfare reforms that left a £5bn gap in her financial plans, said on Thursday she had been upset due to a personal issue. A Treasury spokesperson also confirmed it was a personal matter.
Reeves told the BBC that the welfare changes would be reflected in the Budget and reaffirmed her commitment to fiscal rules. Jane Foley of Rabobank said Reeves now faces difficult choices but added, “investors do place a lot of store in political stability.”
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Customers shop for 'Kolhapuri' sandals, an Indian ethnic footwear, at a store in New Delhi, India, June 27, 2025. REUTERS/Adnan Abidi
INDIAN footwear sellers and artisans are tapping into nationalist pride stoked by the Prada 'sandal scandal' in a bid to boost sales of ethnic slippers with history dating back to the 12th century, raising hopes of reviving a struggling craft.
Sales are surging over the past week for the 'Kolhapuri' sandals that have garnered global attention after Prada sparked a controversy by showcasing similar designs in Milan, without initially crediting the footwear's origins.
After viral photos from a fashion show drew criticism from Indian artisans who make the sandals - named after a historic city in Maharashtra state - Prada was forced to acknowledge that its new open-toe footwear was inspired by ancient Indian designs.
"Prada 0: Kolhapur 1," said an Instagram post by e-commerce website Shopkop, whose founder Rahul Parasu Kamble's open letter to Prada pointing out the footwear is "soaked in tradition" was reshared 36,000 times on social media.
"I saw the controversy as a way to promote Kolhapuri," said Kamble, 33, who has seen sales of sandals he sources from local artisans touch 50,000 rupees ($584) in three days, five times the average.
Social media has been abuzz in recent days with criticism and sarcastic memes, with politicians, artisans and a trade body demanding due credit to Indian heritage.
Prada has said it will arrange follow-up meetings with artisans. In a statement on Tuesday (1), it added the Italian group intends to make the sandals in India in collaboration with local manufacturers, if it commercialises them.
India's luxury market is small but growing, with the rich splurging on Lamborghini cars and pricey watches. Prada does not have a single retail store in India and its products are usually reserved for the super rich - its men's leather sandals start retailing at $844 (£667), while Kolhapuris can be priced as low as $12 (£8.92).
But linking of the Prada name to the Kolhapuri sandals, which are made by around 7,000 artisans, is providing a business opportunity for some.
Mumbai-based Ira Soles is running new Facebook and Instagram advertisements which proclaim its $32 (£24) "Tan Handcrafted Kolhapuris just walked the ramp at Prada ... Limited stock. Global spotlight. Own a piece of what the world is applauding.".
E-commerce website Niira is offering up to 50 per cent discounts on its Kolhapuri slippers it says are "rooted in tradition". Its sales of $18 (£13.5) sandals, that looked like the one Prada showcased in Milan, have tripled, founder Nishant Raut said.
"Why can't an Indian Kolhapuri brand become as big as a Birkenstock," he said.
Handmade in small factories, Kolhapuri sandals, or chappals as they are called in Hindi, are often paired with Indian attire. Similar designs are sold in big outlets of Bata India and Metro Brands, and also on Amazon and Walmart's Flipkart.
In 2021, India's government said the sandals could achieve $1 billion (£728m) a year in exports. Though latest estimates are not available, artisans say the business has struggled as consumers increasingly opt for more fashionable, upmarket footwear.
Still, the Prada controversy is breathing new life into a craft that Lalit Gandhi, president of Maharashtra's main industry lobby group, says is "a dying art". Gandhi said he is in talks with Prada to develop a co-branded, limited-edition sandal.
Kolhapur craftsmen Ashok Doiphode, 50, is pinning hopes on a Prada boost. He hand-stitches sandals for nine hours daily but can sell a pair for just Rs 400 (£3.5)
"If big companies like Prada come, craftsman like me can get a good price."
(Reuters)
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The Canary Wharf business district including global financial institutions in London.
THE UK economy expanded at its fastest pace in a year during the first quarter of 2025, driven by a rise in home purchases ahead of a tax deadline and higher manufacturing output before the introduction of new US import tariffs.
Gross domestic product rose by 0.7 per cent in the January-to-March period, the Office for National Statistics (ONS) said, confirming its earlier estimate. This was the strongest quarterly growth since the first quarter of 2024.
Growth for March was revised up to 0.4 per cent from a previous reading of 0.2 per cent, according to the ONS.
The increase followed growth of just 0.1 per cent in the fourth quarter of 2024. However, GDP fell by 0.3 per cent in April from March, a decline affected by one-off factors.
Outlook for Q2 and pressure on budget targets
The Bank of England expects the economy to grow by about 0.25 per cent in the second quarter of 2025.
Finance minister Rachel Reeves is hoping for stronger growth to reduce pressure to raise taxes again later this year in order to meet her budget goals.
Thomas Pugh, chief economist at RSM UK, said weak consumer spending and hiring data in recent weeks likely reflected a short-term reaction to an employer tax increase and the US tariffs, many of which have now been suspended.
"Now that uncertainty has started to recede, consumer confidence is rebounding, and business surveys point to the worst of the labour market pain being behind us," Pugh said.
A separate survey published on Monday showed employer confidence in Britain had reached a nine-year high, with businesses more optimistic about the economy.
Interest rate cuts expected; energy prices a risk
The Bank of England is expected to cut interest rates two more times in 2025, which could support household spending.
However, a renewed rise in energy prices caused by further conflict in the Middle East could add pressure to the already slow-growing economy.
According to Monday’s ONS data, household expenditure grew by 0.4 per cent in the first quarter, revised up from an initial estimate of 0.2 per cent. The increase was led by spending on housing, household goods and services, and transport.
The UK property market saw increased activity ahead of the 31 March expiry of a tax break for some homebuyers.
Savings fall, manufacturing rises
Households drew from their reserves to support spending, with the saving ratio falling for the first time in two years. However, at 10.9 per cent, it remained high.
Manufacturing output rose by 1.1 per cent in the first quarter, ahead of the US tariff increase in April, compared with the final quarter of 2024.
The ONS also reported that the UK’s current account deficit widened to 23.46 billion pounds in the January-to-March period, up from just over 21 billion pounds in the previous quarter.
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Trump shakes hands with Modi during a joint press conference at Hyderabad House in New Delhi on February 25, 2020. (Photo: Getty Images)
TRADE talks between India and the US have hit a roadblock over disagreements on duties for auto components, steel and farm goods, Indian government sources said to Reuters, dashing hopes of reaching an interim deal ahead of president Donald Trump's July 9 deadline to impose reciprocal tariffs.
Here are the key issues at play:
HURDLES TO A TRADE DEAL
India's dependence on agriculture – a major source of rural jobs – has made it politically difficult for New Delhi to accept US demands for steep tariff cuts on corn, soybean, wheat and ethanol, amid risks from subsidised US farm products.
Domestic auto, pharmaceutical, and small-scale firms are lobbying for only a gradual opening of the protected sectors, fearing competition from US firms.
The US is pushing for greater access to agricultural goods and ethanol, citing a significant trade imbalance, along with expanded market access for dairy, alcoholic beverages, automobiles, pharmaceuticals, and medical devices.
"LACK OF RECIPROCITY"
Despite India offering to cut tariffs on a range of farm products, give preferential treatment to US firms, and increase energy and defence purchases, Indian officials say they are still awaiting substantive proposals from Washington amid Trump's erratic trade policies.
Indian exporters remain concerned about US tariff hikes, including a 10 per cent average base tariff, 50 per cent on steel and aluminium, and 25 per cent on auto imports, as well as a proposed 26 per cent reciprocal duty that remains on hold.
STRATEGIC ALIGNMENT
Indian policymakers see the US as a preferred partner over China but remain cautious about compromising policy autonomy in global affairs.
The US is India’s largest trading partner and a major source of investment, technology, energy, and defence equipment.
TENSIONS OVER PAKISTAN
India remains wary of deeper strategic ties after Trump’s perceived tilt toward Pakistan during a recent conflict between the neighbours, which raised doubts about US reliability.
GROWING INDIAN EXPORTS TO US
New Delhi is confident exports will continue to grow, especially in pharmaceuticals, garments, engineering goods and electronics, helped by tariff advantage over Vietnam and China.
India's goods exports to the US rose to over $87 billion in 2024, including pearls, gems and jewellery worth $8.5 billion, pharmaceuticals at $8 billion, and petrochemicals around $4 billion.
Services exports – led by IT, professional and financial services – were valued at $33 billion in 2024.
The US is also India's third-largest investor, with over $68 billion in cumulative FDI between 2002 and 2024.
US EXPORTS TO INDIA
US manufacturing exports to India, valued at nearly $42 billion in 2024, face high tariffs, ranging from 7 per cent on wood products and machinery to as much as 15 to 20 per cent on footwear and transport equipment, and nearly 68 per cent on food.
According to a recent White House fact sheet, the US average applied Most Favoured Nation (MFN) tariff on farm goods was 5 per cent compared to India’s 39 per cent.