New Delhi: Britain and the European Union struck a post-Brexit deal on Thursday after months of tortuous negotiations. In terms of economic implication, what would this historic trade agreement mean to India?
An economist opines that in the past 18 months during the entire period before Brexit happening, UK has come closer to India as far as economic ties are concerned.
“UK has broken away from the European Union although not fully. The natural consequences would be that the UK will come closer to certain other countries because every country needs to do global trades as these are days of 'globalization'.
Brexit doesn’t mean that Britain or the EU would survive or grow without other countries. They need other countries and India is one country, where we expect a lot of cooperation and growth as far as mutual economic ties are concerned in the coming months and we have already seen a sample of it in the past 18 months. As far as Indians who stay there and get citizenship, for them the rules will be relaxed. So there may be more Indian migrants in the UK and much closer economic ties,” economist Aakash Jindal told ETV Bharat on Saturday.
“UK is the sixth-largest economy and India is the fifth-largest economy. We already are aware of the situation of Japan and China. Japan since the time was compelled to increase the price of its currency, is no longer a growth nation, rather in past three years, the GDP has contracted. Therefore, India is the strongest contender for strong ties with the UK,” he points out.
What would India gain from Brexit agreement?
“There is a lot of positive indication and implications of the trade agreement going ahead. There are many mutual and pension funds in the UK. There will be more gain in investing in India because markets like the US are all saturated economy but India has a growing economy with emerging markets. The Chinese economy, on the other hand, is not in a good condition, so there will be a lot of FDIs, foreign institutional investors and mutual fund investments in India.
Secondly, how India would gain from this agreement is that there would be a lot of manufacturing goods which would be exported from India to the UK because India is going bigger in the manufacturing sector. India will have a lot of inflow of forex by way of Foreign Portfolio Investor (FPI), mutual funds and pension money coming into India. Therefore, both ways India is going to gain,” Jindal explains.
ETV Bharat also spoke to former diplomat Ashok Sajjanhar to have an in-depth detail of the historic trade agreement signed and will the deal be positive or negative for India.
“Many deadlines have been missed and the deal has been warmly welcomed by the UK Prime Minister Boris Johnson and he has said that the UK has once again attained sovereignty, it has been able to preserve its trade, borders and laws. It will be the British court that will be responsible for all the laws as far as its trade affairs and other issues are a concern, the European Court of Justice will have no say in this. In terms of fishing rights, both the sides had to compromise but it is a fair compromise between the UK and European Union,” Former diplomat Ashok Sajjanhar said while in conversation with ETV Bharat.
“On a variety of issues, it is a good deal but the agreement that was existing between the two will be at a lower level. Of course, people can come and go, they don’t need visas but still, there is a possibility of passport checks. We can expect that as far as cars, trucks, individuals, as well as trade flows, are concerned, there are going to be some restrictions and it will be at the lower level of operation.
As far as education is a concern, UK will no longer a part of it Erasmus programme which means that the bright students and scholars from Europe will not be able to come to the British Education Institutions and vice versa. Of course, negotiations will continue between both the sides on some of the aspects but under the circumstances, this is the best news that possibly could have come,” he added.
For India, it is a very positive development, that we have an agreement in place of a situation where there possibly might not have been an agreement also. As far as the UK is concerned, many of the Indian companies whether it is the Tata or the investments made by Indian companies had always looked upon the UK as a gateway to Europe,” ambassador Sajjanhar further added.
