Mumbai-based husband and wife duo Darshan, 35, and Neha Shroff, 32 are personal shoppers who cater only to NRIs and foreigners. They also plan weddings, with 40% of their clients non-resident Indians from the US and UK.
Over the past few months, their three-year-old company has seen a boom in clients wanting to pay in foreign currencies, because they can get so much more value for their money here now.
“Because the rupee is depreciating, clients are spending more on their weddings and during trips in India,” says Darshan. “Overall, this has translated into an increase of 5% to 10% in our revenues over the past year.”
Over the past five weeks, the rupee has slid from 58 against the dollar on July 24 to an all-time low of 68.80 on August 28. As of August 31, it stood at 66.65 against the US dollar.
If this trend continues, the Shroffs expect things to improve further in January, peak wedding season in India. “We expect to see at least 15% more NRIs get married in India, if the rupee doesn’t rally before then,” says Darshan.
The couple from the country’s commercial capital, Mumbai, are not the only ones benefiting from the slide of the rupee.
“Gems and jewellery companies and other export strongholds such as textiles and apparel, leather, and those who export services abroad will benefit,” says economist and political analyst Ajit Ranade. “Entrepreneurs and small and medium enterprises that faced competition from imports also stand to benefit. This Ganeshotsav, for instance, many less idols are likely to be imported from China.”
Others seeing their net incomes rise as a result of the rising cost of foreign currency include charitable trusts and social enterprises that get funding in dollars and families with members working abroad and sending money home in other currencies.
“People who export services, especially to first-world countries, are obvious benefactors,” says Aradhoot Nadkarni, professor of economics with the Mumbai university.
“Overall, social enterprises getting funds in foreign currencies stand to get as much as 20% more upon conversion,” says Deval Sanghavi, partner and co-founder of Dasra, a strategic philanthropy foundation that acts as a consultant in the non-profit sector. “Funding had significantly reduced over the past three years, because of the global recession, so in a sense the depreciating rupee is helping these organisations.”
On a roll
Advertising professional Palak Mody, 29, has been working in Dubai for eight years and is one among the many Indian professionals sending money home in foreign currencies, to be converted into increasingly large sums and salted away here.
“When I started working in Dubai, 1 UAE dirham fetched Rs. 8. Now it’s more than double,” says Mody. “I was considering moving back to India to get married and settle down. Now, I have cancelled all such plans.”
Instead, Palak now visits home on shopping sprees, and sends more money home in remittances to make the most of the high exchange rate and thus boost her savings.
“The many Indian professionals working in the information technology, consulting services, KPOs and BPOs in the US and UK are, at the current conversion rates, earning 20% more in Indian rupees,” says Sunil Goel, managing director of head-hunting company GlobalHunt. “Over the past two months, in fact, we have received 15% to 20% more resumes from those seeking jobs abroad. Our business is also growing as a result, as are our revenues.”
* A booster shot for medical tourism in New Delhi
Medical tourism in Delhi has seen a boost, as more foreigners seek to cash in on the effective slash in prices caused by the sharp devaluation of the rupee.
Apollo Hospital, for instance, saw a 12% growth in the number of foreign patients last year, but in the past two weeks, has recorded a 15% growth over the number of enquiries from overseas patients.
A foreign patient being treated at Artemis Hospital, Gurgaon. Hospitals have seen a jump in the number of foreigners seeking treatment. File photo
“As the rupee depreciates, it pushes up our costs, because we are dependent on imports. But the positive side is that foreign tourists find it more attractive to come to India for their treatment,” says Dr Anupam Sibal, group medical director for Apollo Hospitals Group, which earns about 5% to 10% of its total revenue from international tourists.
At the city’s Sir Ganga Ram Hospital, enquiries from foreign patients have risen by about 10% over the past week.
The Capital’s Fortis Healthcare hospital, meanwhile, has seen the number of foreign-patient bookings jump by about 30% this financial year, compared with last year. This hospital received more than 10,000 foreign in-patients last year and earns about 10% of its total revenue from medical tourism.
“We are definitely seeing a rise in the number of bookings by international tourists over the past two weeks, with the devaluation of rupee,” says Vishal Bali, Group CEO for Fortis Healthcare. “And we are expecting higher growth rate in near future.”
Max Healthcare in Delhi has received about 5,000 in-patients since January. “Though there has been no spurt as yet in the number of enquiries from foreigners, there has been a 25% to 30% rise in the number of foreign patients registering this year over the previous financial year,” says a hospital source.
India treated close to 1 million foreign patients in 2012, a number that is expected to go up by about 10% by the end of 2013.
(As told to Sidhartha Dutta)
* Time for a shopping spree, time to save (Jalandhar, Punjab)
The rising price of the dollar and Great British pound have put Punjab’s NRI community on high alert, with many planning visits to their native lands to make the most of all that their earnings in their foreign currencies can translate into back home, in terms of both purchases and savings.
The effect on dollar inflow will most be noticed in the winter period, the season when most Punjabi NRIs visit home, say experts.
Some are choosing not to wait that long. UK-based NRI Preet Inder Dhillon, for instance, is planning to visit Punjab this month. “Certainly my shopping spree will be more fruitful if the rupee remains at these levels,” says the 42-year-old freelance writer. “Our strong currencies have bought us more financial power.”
Darshan and Neha Shroff from Mumbai, who cater only to NRIs and foreigners, have seen revenues jump by an additional 5% to 10% over the past few months. HT photo/Sanjay Solanki
Families that are dependent on the earnings of members working abroad will experience momentary delight as a result of the weakening of the Indian rupee, adds Kamaljeet Hayer, 47, a UK-based NRI and real-estate businessman.
“But the scenario is not stable as the economy is passing through a transitory phase and we are witnessing daily swings,” he adds. “Moreover, the devaluation is making goods within India, particularly petroleum, more expensive. So that could to some extent neutralise the increased buying power.”
Om Parkash Mehra, chief manager (Overseas Business and Trade) for State Bank of India in Punjab, added that some NRIs were also choosing to play it safe when it came to boosting savings accounts back home. “Since they are unsure about how long the process of devaluation will continue, some are choosing not to stake their money on the rupee right now, citing the risk factors,” he says.
(As told to Sanjeev Bhalla)
* Cashing in the chips in software exports (Bangalore, Karnataka)
Ualitas Technologies is experiencing both the upside and the downside of the currency crisis. A software startup specialising in client-based business technology solutions, the company mainly exports to the US and parts of Europe. Its domestic arm, however, offers industrial automation solutions to Indian companies.
Raghava Kashyapa. HT photo/Keshava Vitla
“While our software business has certainly been affected, and affected positively, by the falling rupee, the domestic arm is anticipating a dip in revenues, as clients hit by rising input costs and the falling rupee begin to rethink orders and prioritise resources,” says founder Raghava Kashyapa, 36, a former senior manager with Microsoft in the US.
With the depreciation of the rupee, the exports arm of Qualitas has seen revenue jump by 20%, thanks to the more beneficial exchange rate.
“But our domestic solutions market has been hit, especially in the automotives segment. Capital expenditure has already been cut. And since most of our components are imported, this has resulted in a sharp increase in our input costs too,” says Kashyapa. “Overall, we expect the current downturn to produce mixed results for us.”
To try and make the most of the situation, Qualitas now plans to focus on strengthening its exports business, where they are still competitively priced.
“In the domestic segment, we’re aligning our business strategies to target export-oriented manufacturing businesses and the FMCG segment, which have not been hit as hard,” says Kashyapa. “Had it not been for our software exports business, we would have been in bad shape this year.”
(As told to Naveen Ammembala)
* NRIs take loans, borrow money to cash in Thiruvananthapuram, Kerala
In Kerala, as the rupee falls, NRIs are laughing their way to the bank. They are also in a race to park their money back home so that it can fetch them a good price and good dividends.
Expats working in the Middle East are currently borrowing from friends and colleagues and taking personal loans to cash in on the situation. Bankers in Kerala admit that, with about 28 lakh people from the state working abroad, most of them in the Middle East, there is a steady flow of money in those currencies into the country.
KC Sajith, 34, for instance, has worked with a trading firm in Bahrain for seven years and began construction of a single-storey home in Thalassery a year ago.
Now, with the currency in which he earns trading higher against the rupee, he is in a hurry to use that bonus to complete work on the house. Over the past three months, he has also been parking more money back home, in savings accounts and investments.
KC Sajith works with a trading firm in Bahrain. He says he will now finish building his home in Thalassery ahead of schedule. HT photo
“For us, it is a windfall,” he says. “A couple of years ago, a Bahrain dinar fetched Rs. 100 to Rs. 110; now it has crossed Rs. 160. It is a blessing for people like us who toil in the desert.”
Meanwhile, the house that he had expected to spend three years building, saving up for construction a bit at a time, is now set to be completed in six months, thanks to the fall of the rupee.
Similarly, AP Joseph, 43, who has worked at an auto repairs unit in Bahrain for 11 years, is now speedily paying back a loan that he took a couple of years ago to build a house in his hometown in Thrissur district.
“This is golden opportunity for me to make my dinars go further,” he says. “I will now lessen the loan burden, which was eating into my remittances. If the slide continues, as predicted, I think I could pay back my R10-lakh loan by next year.”
Some industrious NRIs have even approached their employees and sponsors for advances on their salaries, so that they can make the most of the slide of the rupee and even use the windfall to invest in real-estate.
(As told to Ramesh Babu)