The National Association of Software and Services Companies (NASSCOM) has said the Brexit announcement will result in a phase of uncertainty in the near term but a mix of challenges and opportunities in the longer term. Indian IT services companies, including TCS and Infosys, get about 10-15 per cent of their revenues from the UK. About 800 Indian companies employ 110,000 individuals in that country.
Europe is the second largest market for the Indian IT-BPM industry, constituting almost 30 per cent of the industry’s export revenue of about $100 billion. The UK plays a key role within this market as a gateway for further investment across the European Union.
“NASSCOM urges policymakers in Brussels and London to provide greater clarity and guidance on the next steps as soon as possible so that our businesses have the certainty they need to continue to invest in the UK and Europe,” said NASSCOM President R Chandrashekhar.
The likely impact includes a decline in the value of the British pound, which could render many existing contracts losing propositions unless they are renegotiated. The entire process may also impact decision-making for large projects. Indian IT companies may need to establish separate operations for the EU, which may lead to some disinvestment from the UK.