The flow of remittances from non-resident Indians (NRIs) for investments in land, property and
According to a survey by the Reserve Bank of India in November 2009, results of which were published on Tuesday, only about 4 per cent of the funds were invested in land, property or equity shares compared with 20-25 per cent in July 2006, when the previous survey was held.
On an average, about 20 per cent of the funds received were deposited in bank accounts, the same as in 2006.
In 2008-09, NRIs sent $46.90 billion (Rs 209,267 crore) to their dependents in India. In the first six months of 2009-10, remittances touched $27.51 billion (Rs 1,22,749 crore).
RBI said the findings corroborated the general perception that higher returns tend to influence utilisation pattern of remittances. A predominant portion, or 61 per cent, of the remittances were used for family maintenance.
The survey found that while 31 per cent of remittances received in Delhi were invested in bank deposits, it was 30 per cent in Ahmedabad, 25 per cent in Chandigarh and Kochi and 24 per cent in Jaipur. In Mumbai and Kolkata, only 18 per cent of the remittances were invested in bank deposits.
While land and property attracted seven per cent of NRI remittances in Ahmedabad, it was eight per cent in Bangalore and six per cent in Hyderabad. Despite the rally in prices after the 2009 correction, land and property in Mumbai received only four per cent of remittances.
According to the 2006 survey, 25 per cent of remittances in Jaipur and 20 per cent in Bangalore were invested in land and property, followed by Hyderabad at seven per cent. Even then, land and property in Mumbai attracted only seven per cent of remittances.
A larger share of NRI remittances received in Mumbai, or seven per cent, was invested in equities, compared with 12 per cent in 2006. In Ahmedabad, equities attracted five per cent of NRI remittances. In other cities, the proportion of remittances invested in shares was in low single digits. RBI said the survey attempted to find out the possible end use of funds remitted by overseas Indians.
