Although post-Brexit, India may be unable to use the UK’s presence as a focal point for entry into the EU, India-UK future ties on a standalone basis are less likely to be diluted.
Indian students are likely to get more opportunities to secure jobs in the UK after Brexit. The UK is already a popular destination among Indian students pursuing higher education abroad. On top of it, the recent reinforcement of the two-year post-study work visa is expected to enable the Indian students to improve their job prospects in the country. The preferential treatment to the international students is subsequently expected to boost India-UK ties as well. Even on the trade front, both the countries are set to strengthen their trade relations post-Brexit. “A trade agreement with the UK can be achieved faster because of Britain’s self-interest for securing a post-Brexit trade alliance,” Sarosh Zaiwalla, Founder & Senior Partner, Zaiwalla & Co. LLP, told Samrat Sharma of Financial Express Online.
Here are the excerpts of the interview:
How will Brexit impact Indian companies doing business in the UK?
Indian companies, particularly multinational companies, have used London as a springboard for doing business with Europe. These Indian companies have their European headquarters in the UK as the English-speaking country is considered an attractive base because of its solid financial regulatory systems, stable governance, and impartial judicial system. Any Brexit scenario will involve immediate reconsideration because of different regulations that will take effect between the UK and Europe for businesses operating in Europe through London.
What happens to the companies that are headquartered in London and operate in the entire Eurozone?
London should still remain as an attractive base for Indian companies wanting to do business with European countries. It is true that some businesses will be faced with a period of uncertainty as the UK’s withdrawal from the EU will mean that the benefit of common regulation is likely to be lost. This also includes companies having to deal with two separate jurisdictions, as it will be split between the UK and the rest of Europe.
Do you think Brexit is likely to affect India-UK relations?
India and the UK share a long historic relationship, which has meant there is a common understanding of language and culture. This familiarity has made the UK the first-choice destination for India, and Indian businesses have been using Britain as a gateway to access the EU market. Although post-Brexit, India may be unable to use the UK’s presence as a focal point for entry into the EU, India-UK future ties on a standalone basis are less likely to be diluted.
Especially in the education sector, the UK is one of the most popular destinations for Indian students pursuing higher education abroad. The recent reinforcement of the two-year post-study work visa, allowing preferential treatment to International students will subsequently enable Indian students who comprise a major proportion of student population in the UK to better their job prospects in the country which will further boost India-UK Ties.
How will India-UK trade relations fare post-Brexit?
India-UK bilateral trade currently stands at USD 25 bn and has been growing at a rate of 17 per cent per annum which is indicative of a steady momentum. Brexit will also provide an opportunity for India to establish a Free Trade agreement with the UK the terms of which can be adjusted according to the convenience of the parties and will not have to rigidly adhere to the EU regulations as they have in the past.
What are the recommendations for the Indian company which is looking forward to expanding in the UK?
Over 30 companies from India come to the UK via CII every month, exploring possibilities of the expansion of their business. The anticipation around Brexit has created reasonable apprehension amongst potential Indian investors who’re seeking to venture into the UK and European markets. With the UK exiting the EU, companies need to adjust to the different legal environment because many of the EU regulations will cease to apply in the UK. Businesses that wish to operate both in the UK and the EU will now have to prepare to comply with laws from both jurisdictions.