Prominent Indian businessmen in the Gulf region have said that Britain may reap the benefits of Brexit in the short and medium term from the “protectionism” but investors will have to deal with the UK and EU separately, raising complexity in managing economic and political ties.
They also suggested that it is better to “wait and watch” for the picture to get clearer following the historic polls.
“Resident Britishers may reap the benefit in short and medium term from the protectionism consequent to the Brexit. However, it is an unfortunate event both for Europe and the world at large,” Dr Sideek Ahmed, a prominent Indian investor based in Saudi Arabia, GCC and the UK, said.
“While the economic and financial impact of Brexit itself is big, the geopolitical impact is even bigger. For Saudi Arabia and the GCC, we will now have to deal with the UK separate from EU, adding one more level of complexity in managing economic, financial and political relationships,” Sideek said.
He also said the world needs stronger bonding across nations and regions. He, however, said it remains to be seen how the decision impacts oil prices in the long run.
The members of the GCC are Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the UAE.
“Along with many businesses with operations in the UK and Europe, we will be working through the implications of the news,” said Mehul Kapadia, Managing Director of F1 Business at Tata Communications.
Kapadia also shared Tata Sons’ statement issued following the British referendum.
“There are currently 19 independent Tata companies in the UK, with diverse businesses.
Each company continuously reviews its strategy and operations in the light of developments, and will continue to do so. Access to markets and to a skilled workforce will remain important considerations,” the Tata Sons statement said.
However, Kamal Vachani, Regional Director of ESC Dubai and Director of Almaya Group, said Brexit will benefit trade and travel industry as UK pound will be cheaper in the short term.
“UK is a very popular destination and it will become more affordable to visit,” he said.
Vachani said that Indian investments in UK companies will get a boost while goods and services coming from the UK will become cheaper.
“Real estate in UK in general has very good financial condition and thus UK companies will be more competitive,” he said.
Vachani also said that Indian companies will benefit from the decision as UK companies will be looking for new partners.