As Britain approaches the last week before the June 23 referendum to decide whether it will stay inside the European Union (EU) or exit (Brexit) the block, the prospect of the country leaving the union has increased sharply higher than ever. This is as a majority of British citizens are inclined to vote a 'yes' despite governments and economists the word over warning of consequences if Britain says goodbye to the union.
Sarosh Zaiwalla is a Senior Partner at the international law firm Zaiwalla & Co based in London. The firm deals with both domestic and overseas clients, including corporations and state entities. Its practice areas cover domestic and international litigation, international commercial arbitration, shipping, banking, project finance, energy, company commercial and immigration. In an exclusive interview to International Business Times, India, Zaiwalla discusses Brexit and what it entails for India's trade relationship with the UK.
IBTimes India: There seems to be a tilt in favour of Britain remaining in the EU with IMF economist Thomas Piketty, the US President and G7 leaders supporting the same. Which side do you support?
Zaiwalla: I support for Britain to remain. People supporting Brexit, in terms of immigration, are mostly worried about people moving in from other EU countries, acquiring British nationalities. There is fear among the British as the housing market has gone bad and the influx from EU nations has also affected National Health Service. In my view, remaining in EU benefits Indian businessmen who see Britain as a staging pole for Europe. Brexit may force such companies to open different headquarters in England and the EU where they could face variations in regulations that affect their businesses.
IBTimes India: Supporters in favour of "Vote Leave" have highlighted the possibility of immigration point system similar to that of Australia. Does this mean it will be tougher for Indian professionals to qualify for employment in the UK?
Zaiwalla: Australia has much stricter immigration policy. I do not think UK's immigration policy is comparable to Australian policy.
IBTimes India: Do you think people in Britain are concerned about the immigration influx and consequent erosion of employment prospects?
Zaiwalla: So far Britain has had an open immigration system. The technical requirement for employment is that a person should speak English and have the essential skills that are not readily available in the local market. The employment visa will be given to people who fulfil these credentials. The employment problem associated with Brexit comes at the lower end of the market, which is mostly an inter-EU zone issue, when people from other EU nations take up jobs in construction and other similar domains, but that problem does not affect Indian professionals.
IBTimes India: If Brexit happens, what will be the effect on FDI?
Zaiwalla: If the exit does happen, EU will be able to enter the Indian market. It is the British businesses with offices in other European countries that are likely to bear the brunt since they are the ones more likely to be in business with India than Germany or France. In that sense they may lose the advantage of being part of the EU.
IBTimes India: What will be Brexit's impact on UK's exports?
Zaiwalla: Today Indian exporters are exporting their wares to their offices in London. Indian businesses do not export directly to Europe but via émigré exporters. The Indian businesses ship their wares to the branch offices in London from where they are shipped to other parts of Europe. On the other hand, you take Britain out of Europe, at least in the short-term, the value of pound is likely to devaluate, which could help exports, as far as UK's own exports go. But the UK is also exporting European goods to India without any caveat, which will be adversely affected if Brexit happens.
IBTimes India: According to John Longworth, former Director General of British Chamber of Commerce, FTA between Britain and India can improve especially in services in case of Brexit. Do you agree? Please explain.
Zaiwalla: I do not agree. Brexit is supported today by people who are well above 50 or 60 years who still believe in a culture of independent Britain. The former Mayor, for instance, said that EU is doing what Napolean and Hitler could not do to undermine the culture. One can sense a nationalistic undertone in their messages. They don't realise that the world has changed around and has become more globally connected. As for the Britain's own trade relation with India is concerned, it is completely independent. The UK is entitled to its own trade missions.