Remittances jumped 19% to $66 billion in the last fiscal compared to the previous financial year
Remittances from Non-Resident Indians (NRIs) in the current fiscal are likely to exceed $75 billion, up from $66 billion in the 2011-12, an industry body study has said.
NRIs remittances jumped 19% to $66 billion in the last fiscal compared to the previous financial year, owing to a sharp decline in the rupee value against dollar, Assocham said in a study.
"Even though the rupee may not see as much depreciation as it did in the last 12 months, the remittances would remain robust and may well cross $75 billion in 2012-13," it said.
It said the rupee depreciated by about 25% in the last one year, which had a positive impact on the remittances by NRIs, making up for more than the negative impact that could have been seen on the inflows due to severe slowdown in the western economies.
The study said expensive dollar results in better yields for NRIs when the foreign currency is converted into the Indian currency.
Besides, it said, when the going gets tough in developed economies, Indians living abroad tend to save more and would like to park their surpluses in their home country.
"A robust repatriation of money by Indians abroad prove a great support for India's current account deficit, which otherwise remains a matter of concern in view of continuous and worrisome deceleration in exports of merchandise goods," Assocham President Rajkumar N Dhoot said.
During 2012-13, the current account deficit is projected to be 3.5% of the country's Gross Domestic Product (GDP).
In the last fiscal, it was 4.2% of the GDP.
Referring to the RBI data, the study said, North America, the Gulf countries and Europe are the major sources of repatriation of money from Indians abroad.
However, it said the remittances from Europe are very likely to come under pressure as the rate of unemployment increases in the troubled area, especially in the Euro zone, except in Germany.
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