Mumbai: Brexit will provide the country better market access to the EU and England, even as there will be some market volatility, State Bank of India Chairperson Arundhati Bhattacharya today said.
“As risk aversion sets in, there would be a decline in financial markets and India would see this impact along with other nations. But as trade strategies are reworked there could be potential advantages in the form of better market access for India to the EU and Britain,” Bhattacharya said in a statement.
Britain voted to leave the EU in a deadly blow to the 28-nation bloc, forcing Prime Minister David Cameron to resign in the wake of the defeat in the referendum the result of which triggered a panic reaction in world markets and raised questions over immigration and other issues in Britain after the divorce.
The decision led to a sharp fall in the domestic market as well as in the rupee following which the government and the RBI said the economy has enough “firepower” to deal with the situation. Economic Affairs Secretary Shaktikanta Das said domestic fundamentals are strong enough and the country will not suffer from any long-term impact of Brexit.
He said with comfortable foreign reserves, inflation coming down and structural reforms on path, the country will be able to deal with all eventualities. Reserve Bank Governor Raghuram Rajan also said the Central Bank is watching markets closely the fallout of the British vote for exit from the European Union and is ready to act if there was any disorderly behaviour.
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