This Britain was attacked by the Third Reich in the Mediterranean (Malta, Cyprus, Egypt) in late spring 1941. They suffered many defeats in the Middle East against the Germans, Italians and Arab collaborators. Without the Suez canal, the most important connection from Britain to India was cut. There was even unrest in Churchill's war cabinet. Some ministers and MPs around Halifax pointed out that Britain couldn't fight this war alone forever. Only Churchill resisted: “It's not over yet!” The attack on Pearl Harbor happened as IOTL, so Britain and the Commnwealth had to open a second front against Japan, which gained even more lands ITTL, since Britain was severely weakened. The hard times got better when in May 1942 Germany attacked the Soviet Union, so Britain was relieved. American president Roosevelt knew that he couldn't declare war on Germany as long as he was busy fighting Japan. That's why this strategy was implemented: Britain (including Canada, India and South Africa) concentrated all its strength on the fronts in Northern Norway (where they were thrown out by the Germans during the winter, though), Egypt and Persia. Their troops fighting against the Japanese were gradually replaced by American troops. After that, British troops (including many Indians) were redeployed to the Persian front. In summer 1943, the US entered the war against Germany when they learned about the Reich selling Jews as slaves to Arabs. From then on, the Allies succeeded until the end of the war.
Great Britain is a founding member of TTL's EFTA.