Increasing Cash Flow from the UAE
Recent figures indicate that remittances by Indians in the UAE have increased sharply. According to a report published in Khaleej Times, money transfers from the UAE have increased almost three-fold during the current slide of the Indian rupee. A number of NRIs feel that the present exchange rate presents a good opportunity to remit money home, since one UAE dirham fetches approximately 24.5 Indian rupees.
Why NRIs Are Sending More Money
- The rupee has been weakening in the global market for the last several days. Because of this, Indians living in the UAE are receiving more rupees than usual when exchanging their dirhams. Some NRIs are sending larger amounts to take advantage of the rate.
- Arif Khan, a Sharjah resident originally from Lucknow, said he normally sends Dh1,200 to Dh1,500 every month. But after seeing the rupee plunge he dispatched Dh4,500. Another resident, Anthony Varghese of Dubai, termed the situation as an early Christmas boon.
Impact on Indian Families
Anthony said he normally sends Dh2,000 but has increased that to Dh3,000 this time. His family in India uses the additional money to cover school fees and daily expenses. He added the extra amount feels like a helpful gift, although rising prices in India mean the funds get used up fast.
Market Factors Behind the Rupee's Decline
- The rupee has declined in recent times due to uncertainties over the economic environment between India and the US, coupled with sustained foreign investment outflows. The rupee, in today's session of trading, slumped 28 paise and touched an all-time low of 90.43. According to analysts, further depreciation may occur, touching the 90.70-91 range.
- Foreign Investment Outflows and Import Demand Foreign investors have been withdrawing money from Indian equity and debt markets for months, which has also pushed up demand for the US dollar. Importers, too, are buying dollars in big amounts to settle payment obligations, adding pressure on the rupee and pulling it down.
Tags Cloud
