Indian IT players catering to clients in the financial services space in London may shift their operations to other parts of Europe in the wake of Britain’s exit from the European Union, says tech investor T V Mohandas Pai.
For the Indian IT industry, the biggest immediate impact would be the shift in the movement of Pound Sterling, which has now become cheaper, Pai said.
“That’s already impacting them, marginally, depending upon who is exposed to business in the UK,” he told news agency noting that over a period of time, lot of work is being done by Indian IT companies in UK financial services space in London.
“Now, many of them may migrate to (other parts of) Europe. In case they migrate to Europe, they have to shift to Europe. What happens there is something that needs to be seen. So, there could be temporary relocation over a period of four to five years”, Pai, a prominent angel investor, said.
He also said Indian IT companies may become more competitive in the UK because EU players would not be able to come to the UK very easily as they would now need visa and work permits, unlike the scenario today.
“Competition for India will be slightly less. I think it will be positive. I think overall, lets say neutral (the impact of Brexit on the Indian IT industry) over the next four-years. Right now, it may hurt a bit because of currency but overall it will be neutral over the next four to five years,” the Chairman of Aarin Capital Partners said.
On the strategy that needs to be adopted by Indian IT companies post-Brexit, Pai said they are well prepared.
“They have understood what it is. Currency has fallen 10 per cent today. That no body can prevent. You just have to take it in the chin. Quite understandable. They are working in Europe, the UK and America for many long years, and they can understand whats happening (currency movements)”.