Indian expats in UAE rethink remittances as rupee hits record low against dirham

Business

Indian expats in UAE rethink remittances as rupee hits record low against dirham

The Indian rupee fell to a new record low against the UAE dirham on Friday, touching 24.0762, and surpassing its previous all-time low of 24.0681 set just days earlier on September 1. The sharp slide has prompted many Indian expatriates in the UAE to rethink their remittance strategies.

While some residents are adopting a “wait and watch” approach, hoping the rupee weakens further before transferring money, others are diverting funds into UAE- or dollar-based investments instead of sending them back home.

“The rupee has been falling for the last two years, so I haven’t sent money to India for months,” said Dubai resident Adil Eshack. “I prefer to invest in UAE dirhams and US dollars because the value erodes once it goes to India.”

Market uncertainty, particularly around US tariff policies on India, continues to weigh on sentiment. Traders say possible interventions by the Reserve Bank of India (RBI) have curbed sharper declines, but weakness persists.

Dubai resident Mohammed Iqbal echoed these concerns. “With the uncertainty around tariffs, I expect the rupee to fall further. Unless US policies change, the market conditions will remain the same, so I’m holding on to my money.”

For some, the sustained depreciation has raised long-term concerns. Iqbal recalled buying property in India a decade ago with a Dubai loan, only to see returns fall short. “If I had invested the money in the UAE, my ROI would have been much higher,” he noted.

Others are making strategic transfers. UAE resident Suresh M. said he remitted funds on September 1 when the rupee dipped, as his family needed money for Onam shopping.

Meanwhile, Abu Dhabi resident Melissa Edward takes a more opportunistic approach, waiting for favourable rates before sending money. “I invest in stocks in India and keep some money in the UAE to earn interest. When app alerts show a dip, I transfer funds immediately,” she said, adding that she prefers online transfer apps over exchange houses for better convenience and rates.

The rupee’s weakness also raises concerns about inflation in India, as imported goods and services become costlier. Economists say unless global conditions improve, particularly with US monetary policy and trade relations, the rupee could face further downward pressure.