Many real estate developers across the country have said that there have been numerous enquiries from NRIs on the availability of apartments in large cities. With real estate prices are currently ruling at low levels much lower than they were some time back and NRIs may have thought this an opportune moment to buy. Also, the September 11 attack may have forced many of them to invest in homes much sooner than they may have earlier planned. Though some believe that the increase in NRI remittances to India could be due to the increasing interest rate differential between the US and India, the argument holds little water if one factored in the year-on-year depreciation of the rupee. The spreads then, are minimal. Another section says that some part of the money being remitted by NRIs has been going into the equity markets, given the attractive levels at which some stocks are ruling, but this would be a very tiny proportion of total remittances.

The massive spurt in NRI remittances over the last three weeks, coupled with inward remittances by Indian exporters, has helped the rupee appreciate to a three-month high against the dollar. The rupee, which ended at 47.42 to the dollar on September 11, slipped continuously over the next one month, losing over 70 paise. It ended October 8 at an all-time closing low of 48.13 to the greenback. The rupee ended Friday at 47.83 to the dollar, the same level at which it closed on September 14.

- nriol.com report

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