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Business

BREXIT: No apocalypse

By - Sunil Gupta | 11 Aug 2016 6:53 PM IST

"In India, the liberalization of the foreign direct investment (FDI) regime and related reforms are and will decide the direction of the economy, and no, Brexit is not a factor."

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Too many voices, rather noises, can be heard post the dramatic turn of events in the United Kingdom that saw a four decades old association coming to an end.

 

There’s an outcry about the crash on global stock markets, plunge in currencies and shift of investors toward safe havens; many have feared an upcoming recession and a deteriorated growth and job market. Is that it?

 

Wasn't there a world before 1973 when the UK joined the EU, or before the creation of the European Coal and Steel Community, the precursor to EU?

 

You may either blame all your misfortunes on the way Britons voted in the June 23 referendum, or can make such structural shifts that will take your economy from the red to the green zone.

 

Only because the UK will now not be one of the constituents of the EU, with which governments across the world have entered into free trade and security arrangements, it does not mean that the hold of London, or the existing pacts have come to an abrupt and ill-fated end.

 

In years to come we may see even more conducive agreements!

 

A few not-so-encouraging facts that cannot be ignored are the wipe off of trillions of dollars from the market. Wait a second!

 

It was energy that cannot be created nor be destroyed: money can be created, of course by labour, but can it be destroyed so easily? Did the markets set ablaze a trillion dollar currency note? No.

 

It was only valuations that have corrected, and the drop in UK currency can persuade Britons to work extra hard.

 

In India, the liberalization of the foreign direct investment (FDI) regime and related reforms are and will decide the direction of the economy, and no, Brexit is not a factor.

 

The world economy was already slow, and no UK however within the EU could prevent that.

 

Let us then believe that the UK exit won’t slow it further, if reoriented policies and their directions in individual economies and as a global whole are worked out astutely.

 

Even the much-condemned atom bomb stopped World War II.

 

Believe it, Brexit is no apocalypse.

 

This article was republished from OpenDemocracy.org.

 

 

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