Brexit to hit India’s engineering exports: EEPC
The Dollar Business Bureau
With the European Union accounting for almost one-fifth of engineering exports of India, the imminent leave of the UK from the EU will possibly have a major impact on India, said the apex body of engineering exporters.
“The EU, including the UK, claims almost a fifth of the country’s engineering exports to top 25 destinations, and therefore, any upheaval in the largest trading partner following Brexit would have an impact of great magnitude on the exporters who are already in a state of distress,” said T S Bhasin, Chairman, Engineering Export Promotion Council (EEPC) India, in a statement on Friday.
The overall engineering shipments from India to 25 top destinations were about $7.6 billion for the period of April-May in the current fiscal.
Out of which, the EU nations contributed $1.5 billion, with the UK leading the list. Germany is second in the list.
“From 25 destinations, seven are from the EU. Therefore, any disturbance in the market as an outcome of political separation will have wide economic consequences on trade, investment and currency transfer that can be a cause of concern for us," Bhasin said.
He further stated that the country has a two-year timeframe, to mull and deliberate over its exit. The present situation points towards firm political stand by a separated British polity and leadership of the EU.
The engineering exports from India to the UK during April-May this year were at $372 million and the shipments to Germany stood at $339 million.
The other key trading partners are Italy with engineering exports of $253 million, France $191 million, the Netherlands $141 million, Belgium and Spain of $121 million each.
Bhasin suggested that India keeps a close eye as the events unfold and twist its strategy on the negotiations on India-EU Free Trade Agreement (FTA) while opening new avenues for liberalisation of trade with the UK.
India should also work on a strategy to find a proper solution to tackle the emerging situation, he added.