Will it be a smooth transition or a rough rideIJ
British Prime Minister Theresa May has made it amply clear that the United Kingdom intends to play a full role until it formally exits the European Union. To many in the Union, the British verdict of leaving the trade and monetary union came as a mild shock amidst deepening economic crisis. Although European Union (EU) leaders like Angela Merkel of Germany and François Hollande of France are certain that Brexit would be a ‘rough ride', and its consequences at least in the short term disadvantageous to the British people. It is to be seen whether Brexit amalgamates into a technocratic nightmare as many fear, or turns out to be a just voice of a democratic mandate, as the British Tories would like to cheerfully put it. A major contentious issue that the UK and the European states have to grapple with, is on the European trade. Along with the migration crisis, European trade issues have become a hindrance to what could have been a smooth egress for the United Kingdom. UK's Brexit Secretary David Davis has suggested that getting no trade deals with the European Union on time can jeopardise the UK's trade relations with European member states if they have to fall back on World Trade Organisation's rules in the absence of any new treaty. One thing is conclusive: Trade between the UK and the EU states will reach an all-time low in the next five years if no new treaties are signed.
However, the UK's International Trade Secretary liam Fox has been unequivocal in his view that the trade between the EU and the UK would continue to be “at least as free” after Brexit as it has been till now. Earlier this month, Confederation of British Industry and EEF, a manufacturers' association, wrote to the British Ministers, making a plea to preserve full trade relationship with the European Union. The industry bodies have warned that, beginning a new trade regime according to WTO rules will hamper UK's trade interests as they would leave 90 per cent of all tradable goods with the EU to new tariffs. In the absence of any new treaty, the UK would by design begin to employ WTO's trade rules.
Thus, British businesses are concerned about what they see as disadvantageous to them and are pushing for an early start of parallel negotiations with different European Union states. Some financial pundits have called it a cliff edge threat, as not having a new trade deal before Article 50 that maps British exit from the union, can put trade into uncertainty and debilitate investor confidence. In all likelihood, a trade deal should be in place before 2019 — the expected year of exit for the British from the EU. One way that is currently being deliberated includes a sector by sector trade deal, although such an arrangement may prove costly and allow economic migrants from different EU states to stay longer in Britain than what the Brexiters would want to permit. As for the impact on India, experts believe it will be not unmanageable.