KOCHI: Job loss. Pay cut. Uncertainties in the Gulf. None of these seem to have impacted the inflow of Non-resident Indian (NRI) deposits to Kerala. While the future is anybody’s guess, the growth so far has been exponential.
Consider this: It took over three decades for the NRI deposit in the state to touch the Rs 1 trillion mark. But it took just two years to add another half-a-trillion rupees. At the same time, only a fraction of the inflow has gone into savings.
On December 2014, the total NRI deposits in Kerala banks were Rs 1.05 lakh crore which increased to Rs 1.48 lakh crore in December 2016, according to data collected by the State Level Bankers’ Committee (SLBC). A year ago, the figure stood at Rs 1.28 lakh crore.
“The state received more than Rs 8 lakh crore in the past 14 years as per the Centre For Development Studies (CDS),” Pravasi Bandhu Welfare Trust chairman K V Shamsudheen told Express.
“If NRIs could keep 20 pc of the remittances as deposits each year, along with its cumulative interest, there would have been a minimum of Rs 4 lakh crore in the banks as deposits. But the deposit balance is only Rs 1.48 lakh crore. This data shows a very negligible saving mentality in Non-resident Keralites. These figures show all the remittance the state received had been consumed by families’ non-productive areas like extravagant lifestyle and expenditure like marriages, luxury house-building, cars, expensive healthcare and buying non-productive land. Very little has been saved.”
The Kerala Government data shows there are 16.3 lakh NRKs. Unofficial estimates suggest the number is 25 lakh. The maximum number of Keralites reside in the UAE, followed by Saudi Arabia.
The total NRI deposit in public sector banks in Kerala is Rs 81,993 crore while private sector banks account for Rs 66,081 crore. The erstwhile State Bank of Travancore tops the list with Rs 33,936 crore and the total State Bank group has NRI deposits worth Rs 50,159 crore. Federal Bank holds the second largest deposit base in the state at Rs 33,148 crore.
Indicating the NRI deposit base may erode going forward, Industries Minister A C Moideen said: “The state had progressed over the past four decades depending mainly on NRI remittances. Considering the present geopolitical circumstances, it is impossible to sustain this model of development. We have to attract investment in order to generate jobs for the youth within the state.”