Indian expatriates cash in on the plunging rupee

ABU DHABI // Middle-class Indians are cashing in on the plunging value of the rupee to transfer their savings back home.

Remittance transactions are up by 20 per cent on last year at UAE Exchange. At Al Ansari Exchange they have soared by 20 per cent in just the past two months, and by 25 per cent over the year. “The jump is from high net worth individuals who have their money in savings here and have been waiting for a fall in the exchange rate,” said Sudhir Kumar Shetty, the chief operating officer of the UAE Exchange, which is based in Abu Dhabi and has 550 branches in 29 countries.

Cash sent by blue-collar workers traditionally forms the backbone of the money- transfer business, but the strength of the US dollar – and therefore the dirham, which is pegged to it – against Asian currencies is an incentive for other expatriates to use the service.

The Indian rupee has fallen in value by 20 per cent against the dollar since August, and analysts expect a further 5 per cent depreciation in the near future. It trades at about 53 to the dollar.

Pakistan’s rupee fell about 5 per cent against the dollar last year, and traded yesterday at a record low of 90.42.

The depreciation offers expatriates from the subcontinent the opportunity to take advantage of the higher purchasing power their cash generates in their home countries.

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