Rishi Sunak has dominated out a quick-fix commerce take care of India, making it inconceivable to get an settlement over the road in time for this week’s G20 summit in Delhi – and presumably even by subsequent yr’s elections.

Multiple sources near the negotiations have informed the Guardian the prime minister has rejected the thought of an “early harvest” deal, which may have lowered tariffs on items corresponding to whisky however wouldn’t have handled trickier topics corresponding to skilled companies.

The choice has scuppered any probability of an settlement being struck this week, earlier than the prime minister meets his Indian counterpart, Narendra Modi, within the Indian capital this weekend.

Many now imagine a deal is inconceivable earlier than each international locations maintain elections in 2024, though some in authorities nonetheless imagine it may very well be reached later this yr.

It means the prospect of a UK-India free commerce settlement, lengthy held up as one of many greatest attainable alternatives for Britain after Brexit, stays distant.

One authorities supply mentioned: “There was talk last year of a deal by last Diwali, but that was only going to happen if it was a shallow deal based around a limited number of goods. Kemi Badenoch [the trade secretary] and Rishi Sunak have decided they don’t want to go down that route and so have taken a deadline off the table.”

Another particular person near the negotiations added: “India wants to do an early agreement on goods, but the risk is that instead of being the start of a wider trade agreement, that becomes the end point and the UK doesn’t get any of the more fundamental things it wants.”

UK ministers have lengthy held up a commerce take care of India as one of many nice potential prizes of Brexit. A Foreign Office official told Politico earlier this yr that securing a deal was “the single biggest thing in 2023”, whereas Boris Johnson called the idea of a possible settlement “the biggest of them all”.

In actuality, nonetheless, negotiations have floor on for years with out getting near fruits. Both Johnson and his successor Liz Truss promised a deal by final Diwali, which fell in October, however almost a yr afterwards these near the talks say there stay main areas of disagreement.

“India is the big one, but it has been going on for a while and there remain many areas we have still not got agreement on,” mentioned Lord Karan Bilimoria, the vice-president of the Confederation of British Industry and a key interlocutor between London and Delhi. “India is only the UK’s 12th biggest trading partner – it should be much higher.”

Those near the talks say agreements have been reached in some key areas, corresponding to the necessity for India to chop tariffs on whisky and automobiles and for the UK to take away these on textiles and different items. The Sunday Times reported earlier this month that India was ready to scale back tariffs on scotch whisky by a 3rd to 100% in return for tax breaks for Indian staff within the UK – although British officers say actual figures haven’t but been agreed.

This may need been sufficient to signal a slimmed-down commerce settlement this week, in keeping with sources, however Sunak and Badenoch have rejected such an concept for worry it would make the objective of a extra wide-ranging deal inconceivable.

UK officers level to the instance of Australia, which signed an agreement with India final yr overlaying a restricted variety of sectors as a strategy to kickstart negotiations on a extra complete pact. Since then, nonetheless, these near the method say the Indians have proven little urgency in agreeing the broader deal.

“We could do the kind of early harvest deal which Johnson and Truss wanted to sign,” mentioned one particular person briefed on the talks. “But the better way to keep the pressure up on the Indians is to hold out until we get everything.”

There are nonetheless important areas of disagreement with regards to the great deal underneath negotiation.

India has lengthy pushed for extra visas for Indian college students and for workers of Indian firms. The Home Office doesn’t need such phrases being positioned throughout the commerce settlement itself, though sources point out a separate deal may very well be reached on immigration.

The UK says it has already proven flexibility on visas, greater than doubling the variety of work visas it provides to India every year for the reason that nation left the EU. But the federal government is reluctant to alter the principles on who can enter, particularly within the case of scholars.

However, there are additionally extra basic points dealing with reaching an settlement.

The UK is pushing for higher mental property protections for firms buying and selling in India, particularly within the pharmaceutical trade, the place western firms fret about their medicine being produced way more cheaply by Indian laboratories.

Meanwhile, India needs to restrict the proportion of UK items that may be produced outdoors the UK, as a means of stopping different international locations benefiting from the settlement not directly.

Officials insist a wide-ranging deal may nonetheless be struck this yr if Sunak is ready to persuade Modi to make it a political precedence.

Many imagine, nonetheless, that if it drags on any longer, it would turn into inconceivable within the quick time period as each leaders flip their consideration to basic election campaigns.

“The Indian election is next spring, so Modi will be on the campaign trail by early next year,” mentioned William Bain, the pinnacle of commerce coverage on the British Chambers of Commerce. “If we want to do a deal we need to do it by then at the latest.”