(Representative image)No one knows when a business can face adverse conditions and Brexit has heightened the apprehensions of those who have good and prospering economic ties with Britain.
A vote to decide Britain's continuation in the EU is slated for June 23 and the exit from the EU is termed as Brexit. So far, there are signs that Brexit would happen following a majority Yes vote during the referendum. In that case, Indian businesses could face adverse situations.
There are a lot of Indians who have invested in Britain, in equity as well as debt. An example is Tata's acquisition of Jaguar- Land Rover, which has been accretive to profits as in the case of tea maker, Tetley. However, Tata's involvement with steel firm, Corus, has brought forth losses.
It is believed that there are 800 small and big Indian businesses invested in Britain. After U.S and France, the biggest share of FDI in Britain is due to Indian businesses and it is believed that more than one lakh people are employed in Britain because of investments by Indian firms. India's investment in the UK is more than all other European nations, according to PM Modi.
Britain is considered as the gateway to investments in Europe. One only had to start an office in Britain to gain automatic entry into other European nations. If Britain quits the EU, those desirous of setting up businesses in European nations would have to forge separate deals with each European nation.
Discussions on euro free trade would also be delayed because of Brexit.
Those doing business in Britain alone might not be much affected but those who started an enterprise in some other European nation and then extended the business to Britain would face problems. There are many Keralites who reached Britain through this route.
For the time being, one can only hope that Brexit does not receive a Yes vote.
