India Offers Increased Export Opportunity to UK After Brexit: Study

Britain’s “increased export opportunity” to India, if it is outside the European Union, will be $3.2 billion, according to the Standard Chartered Trade Performance Index, which was released on March 13.

The United Kingdom’s current exports to India are worth $5.5 billion. The predicted figure for exports if Britain remains in the European Union is $9.1 billion, while it stands at $12.3 billion if the country is outside the EU, giving rise to an “increased export opportunity” of $3.2 billion, according to the analysis of Notional Post-Brexit UK Exports.

The United Kingdom’s current export to China is worth $24 billion, and its increased export opportunity if it is outside the EU is $10.1 billion. The report said that like all G7 countries, the United Kingdom would significantly benefit from focusing on China, but it also faces a sizeable opportunity to capitalize on its current relations with India. According to the report, UK businesses missed projections by $4.6 billion with China and $3.6 billion with India.

The Group of Seven (G7) is an informal bloc of industrialized democracies, consisting of Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States.

The Standard Chartered Trade Performance Index reveals the size of G7 goods export opportunities in seven emerging markets — Bangladesh, China, Indonesia, India, Nigeria, Pakistan and Vietnam — termed the E7, representing a total of 49 exporting relationships.

The E7 countries offer significant potential to become key G7 trading partners, the report said. Receiving about 10 per cent of all G7 private sector exports, “the E7 countries represent fast lanes to growth for G7 businesses seeking to drive export growth,” it added.

“With membership of the G7 no longer being a passport to growth, the index reveals real growth opportunities. Every G7 nation has much to gain from accelerating their export performance in the seven economies we have identified as the Emerging Seven (E7),” Michael Vrontamitis, head of Trade for Europe and Americas, Standard Chartered, said in a statement.

If the G7 economies reorient their trade strategy towards the E7, the size of the prize is an additional $162 billion annually, with an immediate 30 per cent gain, Vrontamitis added. “It is clear the E7 represent multi-billion dollar trading opportunities for G7 governments and businesses searching for export diversification and growth,” he said.

The report showed that UK exports to the E7 could potentially increase by $16.9 billion to $64.9 billion when the country leaves the EU. “While the EU remains a critical trading partner, UK businesses could capitalize on export opportunities with all E7 countries,” said the report.

In terms of total imports from the G7, India is second to China, representing 12 per cent of the total potential E7 imports from the G7. However, in actual performance, India is behind in meeting its predicted imports from every G7 country except Germany, said the report.