The power of expat money

India received $23.4B (yes billion!!) in remittances last year, the single largest player now - and the amount has more than doubled in the last five years.

Some staggering statistics:

• Remittances account for 3% of India's GDP
• Remittances are more than both FDI ($4.7B in 2005-06) and FII ($12.5B in 2005-06) combined!!
• Source of all this money - about 111million migrants from India worldwide! (and to think that we still have more than 1 billion people still left over in India ...)
• Fate of these dollars: about 54% spent on family, 20% in bank accounts and about 13% invested in land and property

To put that in perspective - thats about $2.5B invested in real estate - no wonder that property prices are just not coming under control. The endless supply of liquidity into the system is pushing up prices to no end ... and about $5B in bank accounts - no wonder everyone's screaming inflation inflation ... and all this without even considering the increase in the purchasing power of the people as a result of local economic growth!!

No wonder the RBI is having fits trying to curb inflation ...