With the Indian rupee's slide continuing and falling to a new record low against the US dollar in the past few days, remittances from Indian expatriates are on an increase. “I have been watching the exchange rate and sent all of my savings of thousands of riyals to my bank account back home,” Abdul Ali Salam, a shipping executive hailing from the southern Indian state of Kerala, said Thursday. Salam said he remitted the money through the local branch of State Bank of India (SBI) on Wednesday. “I sent an e-mail instructing my bank branch in Kochi, Kerala to transfer the remitted sum to a fixed deposit account for a year, which now fetches an interest of 9.5 percent on Non-Resident Indian (NRI) accounts,” he added. An SBI official, who did not want to be identified, confirmed that remittances to India have been increasing lately. “Why not? Indian expatriates are getting a very good, competitive rate, especially at our bank, and they will benefit if they send the money now,” he told Saudi Gazette. Some of the money transfer agencies of banks like SAMBA, Al-Rajhi and Arab National Bank, as well as Western Union expressed similar sentiments. They all maintained that there is a steep rise in remittances to India. “I have been saving my salaries for the last six months and I was waiting for the money transfer rates to improve. I have sent all my savings,” said Nizamuddin Ali, a travel agency executive hailing from New Delhi. “There may be further slide in the rupee against the dollar, but right now I consider the rate as the best and I transferred a good chunk of my savings,” he added. Meanwhile, the rupee fell to a new record low against the dollar on Thursday as local stocks gave up gains notched earlier in the session while the euro remained near four-month lows, according to reports. The rupee was last trading at a record low of 54.5650, breaching its previous all-time low of 54.52 hit just on Wednesday. Local stocks in India were trading flat after rising as much as 1.3 percent earlier in the session. The main reason behind the slide is India's dependence on oil imports, which must be paid for with dollars, to meet its growing energy needs. Many expatriates, however, expect the Reserve Bank of India to sell dollars if the slide continues. Another reason behind the slide is due to global investors becoming more risk averse as they worry about the fate of the Eurozone. While this has hurt currencies throughout Asia, the Indian rupee has had a steeper fall, largely because of a host of macro-economic problems specific to India. The rupee's sharp losses in recent weeks have underlined how vulnerable the currency is and has raised questions about its future. While India's central bank has said it will take steps to curb further losses, analysts now increasingly believe that the Reserve Bank of India doesn't have much firepower left. This means the rupee is likely to fall even further and at least one analyst said the rupee could fall to as much as 58 rupees for one dollar. __
