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To be or not to be in EU: all you need to know about Brexit

On June 23, registered voters of the United Kingdom will voice their opinion whether the nation should 'Remain' in or 'Leave' the European Union.

Though he managed to get the EU's nod for restrictions on certain welfare benefits for new migrants, British Prime Minister David Cameron was unable to bring unity within his Conservative Party, and thus >decided to seek public opinion on the issue.

While Mr. Cameron wishes his country remain in the EU, former London Mayor and MP Boris Johnson campaigns for Britain's exit, or Brexit as it is being referred to.

The Labour Party too is >divided. While the Labour chief Jeremy Corbyn supports staying with the EU, a group calling itself Lexit (Left for Exit) is campaigning for leaving the bloc citing the EU's Cold War origins and pro-market stand.

While the Scottish National Party (SNP) bats for 'Remain', hardline U.K. Independence Party (UKIP) wants exit from the EU.



A postal ballot paper for the upcoming referendum on UK's membership of the EU, scheduled for June 23. Photo: AFP


Who can vote in the referendum?

Those who can vote in the parliamentary election can register themselves to vote in the referendum. This includes British and Irish citizens over 18 years of age and residents of the U.K.; Maltese and Cypriots over 18 years of age and residents of the U.K.; citizens born in the Commonwealth countries, who are over 18 years and are U.K. residents; British citizens who have lived overseas for less than 15 years; Irish citizens who were born in Northern Ireland and registered to vote in Northern Ireland in the last 15 years; Commonwealth citizens in Gibraltar over 18 years; Members of the House of Lords in Gibraltar. >Read more

What’s U.K.’s history with the EU?

European Union was originally formed with six nations in 1957. Today, it is a gigantic transnational entity of 28 countries, including the U.K., which joined only in 1973. Though part of EU, Britain has traditionally had a 'eurosceptic' stand. It continues to use the Pound as its currency, while most EU nations have moved to Euro. Neither does it participate in the Schengen border-free zone, which allows passport-free travel in EU.

Interestingly, this is the second time U.K. has sought a referendum on this issue. In 1975 Prime Minister Harold Wilson called a referendum after considerable opposition rose from within the country on U.K. staying with the European Economic Community, the precursor of the EU. With 67 per cent of those who voted preferring to 'Remain', U.K. stayed on.



UKIP Leader Nigel Farage, speaks at the final 'We Want Our Country Back' public meeting of the EU Referendum campaign on June 20, 2016 in Gateshead, England. Photo: Getty Images


Why do some in Britain want to leave the EU?

Many people in Britain believe that EU is making inroads into British sovereignty. Many in the ruling Conservative Party and the U.K. Independence Party (UKIP) believe that the EU has changed since the time it was formed and that it was impacting daily life.

Some key issues are:

Immigration

As EU's membership expanded, more Europeans, especially from poorer EU nations, started migrating to U.K. using the “freedom of movement” clause. The anti-immigration parties argue this puts a severe strain on national resources and add up to welfare expenditure. The pro-EU members argue that EU migrants contribute more to the national economy than they take out.

Security

The Remain side argues that in the era of international terrorism and criminality, cooperating with the EU will make the U.K. safer, while the other side says that the security risk will in fact increase if the U.K. does not have control over its borders.

Employment

The Remain side argues that as three million jobs are tied to the EU there could be a jobs crisis if the U.K. leaves the EU; Brexiteers claim that there will be a jobs boom without the fetters that EU regulations impose.

Trade

On trade, the Remain side says that access to the single European market, free of tariffs and border controls, is critical for the U.K. as 45 per cent of its trade is with the EU. The Leave side says that the EU needs British markets and individual trade deals with European countries can be easily negotiated.

Economy

Remain argues that leaving the EU will put the dominance of London, the Europe’s financial centre, at risk as banks will move out, whereas the Brexiteers argue that London’s status is unassailable as it is already a global power base.



A supporter of the "Britain Stronger IN Europe" campaigns in the lead up to the EU referendum at Holborn in London on June 20, 2016. Photo: Reuters


What will happen if U.K. votes for a Brexit?

A key impact would be on laws of United Kingdom. According to a 2010 House of Commons Library study, around 17 per cent of U.K.’s laws are the result of its membership in the EU. Much of this has to do with agriculture, fishing, environmental policies, and trade.

For example, British farmers have to meet the EU standards of quality control to export to member countries. EU’s agriculture policy lays down the law on GM crops, animal husbandry and even how much of his field a farmer must leave fallow to get subsidies.

Another example is the fishing policy. There is a 200-mile fishing zone around the U.K. coastline. Under EU law, U.K. fishermen can fish only up to a specific quota and fishing fleets from other EU countries are given equal access to the zone. The U.K. boats get an exclusive 12-mile zone. Now if the U.K. left the EU, the 200-mile zone will be back in its control though it may have to have individual agreements with countries that want to fish there.

With agriculture, British farmers will lose the EU subsidies. But the British government will probably help out there. The other areas where the EU laws reign are in the fields of criminal justice, data protection, immigration and broadcasting, human rights among others. If the Brexit happens, then Britain will have to negotiate with the EU on a case-by-case basis.

A 'no' result might also take a toll the country's political scenario, given that the Prime Minister himself is a EU supporter.

What if U.K. citizens choose to stay with EU?

This could boost the image of Mr. Cameron. But, the vote will not substantially change the dynamics of U.K. with EU. However, EU can heave a sigh of relief.

How will this referendum affect the EU?

Much of the EU’s money comes from its member states. And the UK is one of the larger contributors.

The money is spent on administration of the EU in each member country, aid activities outside the EU, grants for asylum, education and culture, on preserving and managing natural resources (this includes, agriculture, fishing, mining and so on), helping poorer countries in Europe and in grants to research in science and technology and in helping small businesses.

A British exit from the European Union would rock the Union — already shaken by differences over migration and the future of the eurozone — by ripping away its second-largest economy, one of its top two military powers and by far its richest financial centre.

This could also give rise to more nations contemplating exit from the Union. Greece, last year >held a referendum in which its citizens overwhelmingly rejected EU's bailout norms.

Finance Minister Wolfgang Schäuble >had asked “How would the Netherlands react, for example, which is traditionally very strongly linked with Great Britain?”

Why should India worry about it?





Though India has refrained from officially commenting on the crucial June 23 referendum, >it remains deeply vested in the outcome. The first concerns the welfare of a nearly three-million strong diaspora of Indian-origin U.K. citizens, while the second concerns the interests of a large moving population of Indians who come to Britain ever year as tourists, business people, professionals, students, spouses, parents and relatives.

There are 800 Indian companies in the UK — more than the combined number in the rest of Europe. Britain's exit from EU may affect Indian companies’ appetite for investing in the U.K., particularly those seeking access to the European market.

However, there is a tone of optimism in the Indian circles. An SBI report, for instance, mentions, "This referendum will have geopolitical implications and will affect the relation of the rest of the world with Europe. But, our take is that though such an exit brings up a lot of uncertainty within Europe, it definitely opens up opportunities for India."

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