The whole world is still in dilemma whether Brexit will happen or not. The UK had been due to leave on 29 March 2019, two years after it started the exit process by invoking Article 50 of the EU's Lisbon Treaty. But the withdrawal agreement reached between the EU and UK has been rejected three times by UK MPs. EU leaders agreed to extend the Article 50 process further and the current Brexit date is 12 April 2019. However, Theresa May has again requested an extension until 30 June - which EU leaders will consider on 10 April.

But if it does happen than how it will impact Indian economy –

Positive Impacts

  • Since, India is a major importing country, so if Brexit happens than it will weaken the pound and it will benefit India on importing goods. With lower pound value, Indian companies may be able to acquire many hi-tech assets.
  • Troublesome due to Brexit will force investors to look for safe heavens and what other option they have, other than India whose economy is booming year on year.
  • More for the Indian Citizens, it will be easy to avail education abroad and tourist will have to pay less on UK trips.
  • Brexit might boost trade ties between India and UK. There will be trade pact between the two countries. Britain will need a steady inflow of talented labour, and India fits the bill perfectly due to its English-speaking population.
  • Brexit would weaken global growth and lead to a meaningful decline in commodity prices. Every 1$ drop in crude prices helps India to roughly save $1 billion dollar for its oil import bill, reducing its trade and current account deficits (CAD).

    • Negative Impacts

  • Britain always provided a gateway to the European Union. Many Indian businesses have their offices in Britain so they can avail benefits and continue to remain a part of the EU. But with Brexit, this benefit will be taken away and may result in companies relocating their business set ups to other places.
  • Rupee may depreciate because of the double effect of foreign fund outflow and dollar rise. Sensex and Nifty may tumble in the short-run, so India will have to adjust to changing world order.
  • NASSCOM has predicted that the effect of Brexit will be felt on the $108 Billion Indian IT sector in the short term. These things can be covered up in the next few years wherein alternate arrangements can be placed between the countries. Also, In the automobile industry, Brexit may lead to reduction in sales and companies that derive good revenues of profits from Britain could get hurt majorly.

    • This is all for Brexit, I will keep posting more on such informational topics. Keep Reading :)