The International Monetary Fund (IMF) has said the Dubai World debt restructuring “will not have a large impact” on the flow of remittances out of the UAE.
The UAE accounts for nearly 13 per cent of the total remittance flow into India, with as many as 42 per cent of the 1.5 million population of Dubai being Indians.
Noting that remittances worth $10 billion (Dh36.7 billion) go out of the UAE, a top IMF official has said the Dubai debt restructuring might have some effect on those outflows.
“… I think it’s important to recognise that while there may be a slowing down in Dubai, Abu Dhabi continues to grow rapidly, as do other countries in the Gulf Cooperation Council (GCC). So the net effect in terms of remittances out of the region may not be as large,” Masoud Ahmad, director of IMF’s Middle East and Central Asia Department said on Wednesday.
The Reserve Bank of India on Thursday said the crisis would have some impact on remittance flow into the country, especially to those states which get huge inflows from the Gulf.
“Some parts of the country are certainly more dependent on remittances from Dubai, but overall I think it is too early to say. There could be some impact… ,” RBI Deputy Governor Usha Thorat had said.
Sudhir Kumar Shetty, chief operating officer of UAE Exchange, one of the country’s largest money exchange houses with branches elsewhere in the Gulf and beyond, said transfers from Dubai had dropped slightly but extra business from two other emirates, Abu Dhabi and Sharjah, had compensated.
“We haven’t seen any change in volumes since the news [of the restructuring] broke. As long as expatriates are employed, they will make remittances,” he said.
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