Remittances from NRIs may exceed $75 bn in FY13

Remittances from non-resident Indians 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 per cent to $66 billion in the last fiscal compared to the previous financial year because of 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 per cent in the last one year which had a positive impact on the remittances by NRIs, making up 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 per cent of the country's gross domestic product.

In the last fiscal, it was 4.2 per cent of the GDP.

Referring to the Reserve Bank of India 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.