Currencies of both countries hit record lows against the US dollar
Transfers from the UAE to India and Pakistan have increased after both currencies plunged to record lows. Currency exchange officials in the UAE expect a further increase in remittances in the coming months as currencies depreciate further.
The Pakistani rupee reached $62 against the Emirati currency on Thursday amid political uncertainty and unrest in the country. Similarly, the Indian rupee fell to 21.83 against the Emirati currency on Thursday. It is down nearly eight percent since January 2022.
An Al Fardan Exchange spokesperson said total personal remittances from the UAE rose by 11.4 percent.
“We have certainly noticed an increase in remittances to India and Pakistan as residents benefit from the weak exchange rate. Remittances to India and Pakistan have increased significantly in terms of transactions, numbers and volume. We have seen volume growth of 12.5 percent for Indian rupees and 24 percent for Pakistani rupees compared to last quarter,” the spokesman said, adding that they expect more remittances in the coming months as currencies depreciate further.
Rashed Al Ansari, CEO of Al Ansari Exchange, said remittances by Indian and Pakistani expatriates living in the UAE continue to increase due to favorable exchange rates resulting from the depreciation of the respective currencies against the dirham.
“Over the past three months, rupee remittance flows have increased as Indian and Pakistani expatriates take full advantage of the rupee’s volatility. We estimate an increase of about five percent in remittance transactions for both currencies. We usually see an increase in remittances and foreign exchange transactions when the value of a currency falls against the dollar,” he added.
A LuLu Exchange spokesperson said they have seen growth in remittances to the two South Asian countries in both numbers and volumes.
“Remittances to India and Pakistan are up three to five percent,” the spokesman said, adding that the trend has become quite unpredictable with a larger group of people still waiting for a further drop in rates.