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 said on Friday.
"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.
According to Mahindra Group CFO V S Parthasarathy, Brexit will throw up many opportunities as well and the impact on India and Indian industries will not be significant.
The result is uncertainty in the immediate aftermath which will moderate over time, he said.
Echoing similar views ICICI Prudential AMC CIO S Naren said the fund house sees Brexit as buying opportunity in the long term.
While it is difficult to predict market movement in the short term, recent correction offers a long term buying opportunity for investors, Naren said.
"Will be concerned if monsoon turns adverse, not Brexit.
We believe a normal monsoon is one of the most important factors for the markets. We believe Indian equities could do well compared to other emerging markets owing to favourable domestic macroeconomic factors and low crude oil prices," he added.
The knee-jerk reaction seems to be on account of the fact that most people expected a verdict of remain in the EU and the vote has turned out to be exit but selective buy opportunities may emerge in the turmoil, Rajeev Thakkar, CIO, PPFAS Mutual Fund said.
As per rating agency ICRA, post-Brexit uncertainty may weigh upon the performance of merchandise and services exports and delay the concretization of investment plans, partly moderating the expected benefit of the recent FDI reforms.
"If the fall in crude oil prices sustains, it would offset the impact of lower exports on the current account deficit as well as the effect of the depreciation of the INR relative to the USD on inflation. We expect the INR to remain in the range of Rs 67.5-70.0 per dollar over the course of FY2017," the rating agency said.