Overseas Indians parked $1 billion in NRI deposits in April
Overseas Indians parked $ one billion in various NRI deposit schemes in April reflecting a strong faith in India's growth story because these deposits witnessed outflows of $150 million in the same period a year ago.
Outstanding non-resident Indian (NRI)deposits touched $ 153 billion as of end April on account of the $1.08 billion, the latest data released by the Reserve Bank indicated.
Three schemes under which there are inflows include foreign currency non-resident (Banks) or FCNR(B) where the foreign exchange risk is borne by the deposit accepting bank, non resident external rupee account or NRE(RA) where the currency risk is borne by the depositor. While the former is attractive when the rupee is depreciating against the dollar, the latter is attractive when the rupee is appreciating.
During the month a bigger chunk was garnered under the NRE (RA) with deposits worth $583 million, while $483 million flows were in FCNR(B) scheme.
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In addition to these two schemes, NRIs also park funds in NRO or non-resident ordinary deposit schemes. The funds in these schemes are meant for local use by the NRI and repatriable upto a certain limit. About $27 billion is the outstanding amount parked in this scheme compared to the outstanding amount of $99 billion in NRE(RA) and $26 billion in FCNR(B).
A longer term trend in data shows that during Covid period, it picked up sharply to $ 142bn from $ 131bn despite a softer interest rate regime globally. Bank deposits
