Published & Updated as on - 2010-04-18
Indian
expats remittances increase despite global
slowdown
Remittances by Indian expatriates
rose by over $ 1 billion to $ 27.51 billion (around 1,22,420 crore) during
April-September 2009, unfazed by the global financial meltdown, a RBI survey
has said.
The remittances increased from $ 26.37 billion
during the same period in the previous year, as India provided much better
returns.
"inward remittances in India have not been
impacted significantly by the global economic crisis," RBI said in its
latest monthly bulletin.
It further said that the rise in
remittances may be attributed to a number of factors, including depreciation of
rupee resulting in the rise in inflows through rupee denominated NRI accounts
to take advantage of the depreciation and hike in interest rate ceilings on NRI
deposits since September 2008.
RBI said that it was feared
that the global recession could impact migrant workers more severely.
"Even
if there is no lay-off, workers would often have to accept lower wages as
employers worldwide are seeking to cut costs in an attempt to cope with the
financial crisis," it said.
The survey, which was
conducted in November 2009, said that North America continues to be the most
important source region of remittances to India despite its share in total
remittances falling to 38 per cent (44 per cent during the 2006
Survey).
This is in line with the fact that a large
proportion of migrants to North America (US and Canada) work in software and
other Information and Communication Technologies (ICT) related areas which have
relatively higher average earning levels.
The Gulf region
accounts for an average of 27 per cent of the total remittance inflows to
India, with major source countries being the UAE and Saudi
Arabia.
While Kochi and Mumbai receive above 50 per cent of
their remittances from the Gulf region; Ahmedabad, Bangalore, Chandigarh,
Delhi, Hyderabad and Kolkata received more than 60 per cent of their inward
remittances from North America and Europe together.
It
further said that while the larger numbers of the bank branches that were
surveyed have reported negligible impact of global crisis on flow of remittances,
responses have been mixed across the regions.
"Majority
of the respondents in Delhi and Chandigarh centres said that ongoing recession
led to decline in the remittances, while in Ahmedabad centre, the majority of
the respondents did not see any significant decline in the flows of remittances
in the region," RBI said.
Source: ET
18/4/10
India’s budget yet again demonstrates to NRIs that
investing in their homeland is probably the best option right now. The West is
still struggling to climb out of one of its deepest recessions and provides low
returns, while India’s growth story promises healthy returns. Surely, it’s time
to wake up and smell the Indian coffee. Soon after the budget was read, the
Indian stock exchange gave it a thumbs-up sign without delay as the market
climbed up by a hefty 175 points. The return on Indian equities in the past
year has been calculated at 87.4 percent by The Times of India. If an NRI
invested in real estate stocks for the last year, the returns would be a
whopping 139 percent.
The auto sector was not far behind as
the returns on wheels was 184 percent. Again, consumer durables and the IT
sector would have raked in returns at 150 percent and 125 percent respectively.
Now, where would an NRI get his investment almost doubled in one year? As far
as returns on fixed deposits are concerned, NRIs can reap much higher returns
of eight percent for term deposits if they convert their currencies into Indian
rupees. This compares with two to three percent when they keep their funds in
hard currencies in India or abroad. Considering that over 100 banks have failed
in the US following the meltdown and a number of British banks were also
shaken. NRIs hastily sent their savings to India and the country’s foreign
exchange reserves are hovering at a bulging $280 billion
now.
Source : Indian Realty News 24/3/10
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