Britain has effectively abandoned legislation to hand sovereignty of the Chagos Islands to Mauritius after the United States withdrew its backing for the deal, leaving the two allies at odds over one of the most strategically significant military sites in the Indo-Pacific region. A Foreign Office minister told the UK parliament this week that the treaty had become "impossible to agree at political level," and that the corresponding bill would not complete its passage before parliament is dissolved in the coming weeks.

The Chagos Islands are a remote British-administered archipelago in the Indian Ocean, roughly 2,000 kilometres northeast of Mauritius. The deal, signed in May 2024, would have seen Britain cede sovereignty of the islands to Mauritius — its former colony — while leasing back Diego Garcia, the largest island and home to a major joint UK-US military base, for 99 years at a reported cost of around £90 million (approximately $111 million) per year. The base has served as a critical hub for Western military operations and was used by the US during Britain's recent strikes on Iran, which London described as defensive operations.

Minister Stephen Doughty told parliament that the agreement had originally been negotiated in close coordination with Washington and had been "tested thoroughly at all levels of the United States system under two administrations." President Donald Trump initially praised the deal as "very strong and powerful" after it was signed, but reversed course sharply in January, posting on his Truth Social platform that Britain was giving away Diego Garcia "for no reason whatsoever" and warning that China and Russia would interpret the move as weakness. The shift in the US position made it impossible to update a foundational 1966 bilateral agreement — known as the "exchange of notes" — that governs the use of British Indian Ocean territories for defence purposes, a step that was legally required to ratify the treaty.

London insists it has not entirely abandoned the deal. A Downing Street spokesperson reaffirmed that "Diego Garcia is a key strategic military asset for both the UK and the US" and that the government is "continuing to engage with the US and Mauritius." Prime Minister Keir Starmer has consistently argued that international legal pressure — including a 2019 International Court of Justice recommendation that Britain return the archipelago to Mauritius — means a negotiated settlement is the only way to guarantee the base's long-term security.

The collapse of the parliamentary timetable carries significant human consequences. Britain forcibly removed thousands of Chagossian islanders from the archipelago in the late 1960s and early 1970s to make way for the military base; descendants have spent decades pursuing legal compensation and the right to return. Doughty acknowledged the setback would be "sad news" for many Chagossians who saw the treaty as their best hope for a sustainable resettlement programme. The episode also highlights the broader strains in the UK-US relationship under the Trump administration, with the Chagos impasse coming alongside sharp public disagreements between Washington and London over a range of foreign policy issues.