“All countries around the world will have to brace themselves for a period of possible turbulence, while being watchful about, and alert to, the referendum’s medium term impacts,” the finance minister said.
“But as investors look around the world for safe havens in these turbulent times, India stands out both in terms of stability and of growth,” he said.
RBI Governor Raghuram Rajan said though Britain’s decision to quit the European Union was a shock, India’s apex bank was ready to act when necessary.
“RBI is watching the markets. It is very ready to act where there is disorderly conduct of the markets. And we are prepared to act.” The Governor said the Reserve Bank of India had prepared for this outcome too though polls had suggested confidence in the ‘Remain’ vote on Brexit.
“In any kind of market volatility, there is opportunity also. Some movement in currency is warranted. We are watching all the markets and prices though it is not an immediate shock for liquidity in the system.”
“It helped that the finance minister and the central bank governor reassured investors the India’s fundamentals are strong and that everything would be done to curb volatility,”Anand James,Chief Market Strategist at Geojit BNP Paribas said.
Vaibhav Agarwal,Vice President and Research Head at Angel Broking said: “Global markets will continue to be under pressure due to volatility in currency and bond markets in the days to come.
“The impact of Brexit will certainly be negative in the short-term on account of volatility in the exchange rates, uncertainty in the markets and the terms on which Britain will leave the EU,” Nasscom President R. Chandrashekhar said. Terming the Brexit as a phase of uncertainty in the near term, the National Association of Software and Services Companies (Nasscom) executive said the historic move was also a mix of challenges and opportunities in the longer term.
“Europe is of prime importance for India, as it is not only the second largest market for our industry, but also contributes nearly 30 per cent of software export revenue, which is equivalent to $100 billion,” Chandrashekhar asserted. Noting that Britain had been a gateway for the Indian industry’s investment across the EU over the decades, Chandrashekhar said a decline in value of British currency (pound sterling) would render contracts losing propositions unless they were renegotiated.
“The uncertainty surrounding protracted negotiations on the terms of exit and/or future engagement with EU could impact decision-making for large projects,” he pointed out. The exit may also lead to Indian outsourcing firms setting up separate offices or operations for EU and divestment from Britain. Mobility of skilled labour between Britain and the EU will also be affected, while changes in the financial system and banks would have a bearing due to currency impact. “Hence we urge policy makers in Brussels and London to provide greater clarity and guidance on the next steps so as to ensure our businesses have the clarity to stay invested in Britain,” said Chandrashekhar.
The historic development will also unleash opportunities as about 800 Indian firms, employing 110,000 people across the country, have a deeper partnership with Britain.
“In the long term, however, Brexit could lead to strengthening of Indo-British economic relationship, as Britain seeks to compensate for loss of preferential access to EU markets,” Chandrashekhar affirmed. With Britain less dependent on intra-EU immigration into its country, it could become more open to high-skilled immigration from other non-EU countries, including India.
“Britain will be under no obligation to adopt restrictive EU data localisation norms, which it does not subscribe to in their entirety. All these factors could benefit our bilateral economic relations,” the former telecom secretary added.
BRITISH ASIANS AT RISK:
The impact of Brexit on three million British Asians, especially the 1.6 million Indians, will be enormous. They are one of the most successful communities in Britain. The ABCD (Accountant, Barrister, Chemist and Doctor) culture of British parents produced so many of them. There are over 60,000 Indian doctors working in the National Health Services besides nearly 20,000 nurses, majority from the South Indian state of Kerala.
The Brexit victory has polarised the country and it will make the situation worse at public and work places. The campaign crossed the decency at various stages and it fell when the UKIP leader unveiled the controversial poster with Syrian refugees.
For the average voter, immigration was the main issue. Except London, Scotland and Northern Ireland, the issue played a crucial factor in their decisions. That makes every one of us vulnerable. The issue may be on Eastern Europeans, but next will be us. The Black and Ethnic Minority Community have a reason to worry. When the campaigns were hijacked by right-wing politicians and their followers, the future is tense for British Asians.
The hardworking plumbers and unskilled workers were taunted in the streets with a question about their return journey. Don’t feel lucky. It may be your turn next. The country has polarised. The immigrant population are the reason for all the trouble. They are ignoring the fact that thousands of doctors from India are shoring up the ailing health services; IT experts from India are running the country smoothly and skilled and unskilled workers from Eastern Europe are running the factories to meet their deadlines and targets. If things get worsen, they will blame you. Give a dog a bad name and hang it.
More than a hundred incidents of racial abuse and hate crimes have been reported in UK since she voted to leave the European Union last week. The targets were not only Europeans but people of color, including Indians.
Only two of the cases have been filed so far with the police, the rest have been noted in social media. But the reports have been so alarming that the matter was taken up by the UK Parliament, which met for the first time after the Brexit vote on June 27.
Calling it “a matter of great shame,” Prime Minister David Cameron said, “I want to tell the people from EU living here and our Brits living in the EU, that these incidents will be tackled severely.”
Sharing his humiliating experience, Nikhil Pandhi, a student from Oxford University, said a group of Britons had targeted him at Lisbon airport’s immigration counter.
It was June 24, the night of counting after the referendum and the topic under discussion was Brexit, he said.
“One of the men asked me where I was from,” he said. When he replied “India”, the man snatched his passport and the biometric proof of residence in UK. “I was sporting a beard in that picture, which was taken 2 years ago. He remarked, ‘You look like a terrorist’.”
“Until now, I did not think the UK is a racist country. I’ve lived here for 2 years, but after this, I see it as a larger issue,” he said.