Indian expats drive 17.4% surge in Q1 remittances

dubai — Remittances from the UAE, driven mostly by Indian expatriates, surged 17.4 per cent in the first quarter of this year, according Central Bank figures.

Total remittances recorded in the first three months rose to Dh43.5 billion from Dh37.1 billion in the same 2017 period. Money exchanges accounted for around 70 per cent of transactions, valued at over Dh30 billion, marking a rise of more than 10 per cent compared to the same period last year, figures quoted by Wam show.

Indian workers remitted Dh16 billion, accounting for 36 per cent of total transaction value, followed by Pakistanis at 8.8 per cent, Filipinos at 6.9 per cent, Omanis at five per cent, Egyptians at 4.9 per cent, Americans at four per cent, British at 3.4 per cent and Bangladeshis at three per cent.

In 2017, expat remittances from the UAE amounted to Dhs164.3 billion, up 2.2 per cent from Dh160.8 billion in 2016.

In the fourth quarter of 2017, Indian expatriates sent Dh14.8 billion,

We believe that Indian rupee could move between 67.75-68.30 against the dollar in the coming few days Adeeb Ahamed, MD, LuLu Financial Group

which was about 34.2 per cent of the total Dh43.2 billion remitted from the UAE during the threemonth period.

Exchanges houses said the surge in remittances by Indian expatriates was triggered by the weakening of the Indian rupee against the dollar pegged dirham over the past few months.

Adeeb Ahamed, MD, LuLu Financial Group, said first quarter witnessed the Indian rupee slide on account of rising oil prices and the general bearish movement of the equity markets. “All currencies, including the euro and pound had also weakened in this context. The Indian rupee also went on to close at 18.58 against the dirham in May, which is one of the lowest in nearly four years. This has in turn sparked a slight surge in remittances in Q1.”

“Currently, the Indian rupee is tracking the euro and pound sterling, both of which has registered a steep fall. Other Asian currencies have also gone down, with the strengthening of the US dollar. We believe that Indian rupee could move between 67.75-68.30 against the dollar in the coming few days,” said Ahamed.

Pradeep Unni, head of Strategic Business Development, Richcomm Global Services DMCC, said it’s natural to see a sharp spike in remittances to India, as most Indian expats send additional funds to take advantage of better conversion rate. “Rupee fell against the dollar by over two per cent in first quarter of 2018 and the slide extended to over 7.23 per cent by the third week of May 2018,” he said.

According to World Bank data, globally, India retained its position as the world’s top remittance recipient as remittances world wide rebounded seven per cent to $613 billion in 2017, from $573 billion in 2016, driven by higher oil prices and a strengthening of the euro and rouble.