Resolution:
You can use transform XML activity to get rid of the namespace prefix. The following is a style sheet which you can use in the transform XML activity:

<?xml version="1.0" encoding="UTF-8"?>
<xsl:stylesheet version="1.0" xmlns:xsl="http://www.w3.org/1999/XSL/Transform"
xmlns:this="http://www.asml.com/DataModel/Business"
xmlns:that="http://www.asml.com/DataModel/Technical">
    <xsl:output method="xml" version="1.0" encoding="UTF-8" indent="yes"/>

    <!--xsl:template match="node() | @*"-->        
    <xsl:template match="*[not (namespace-uri())] | *">
        <xsl:element name="{local-name(.)}">
            <xsl:apply-templates/>
        </xsl:element>
    </xsl:template>
        
</xsl:stylesheet>

We need to create an XML file without the namespace prefixes from an input XML string in which all the elements are namespace qualified. How can this be done in BW?