Outward remittances stay high for third month in a row
Outward remittances by Indians remained elevated for the third month in a row. The remittances under the liberalised remittance scheme (LRS) for resident individuals grew to $457.5 million in September 2015 from $408.4 million in August.
In July 2015, outflows were $380.3 million, a sharp jump from $140.7 million in June, according to Reserve Bank of India (RBI) data.
The remittances under LRS in September 2014 stood at $110.2 million.
The payment for maintenance of close relatives abroad jumped to $120.6 million in September 2015, up from $14 million a year ago.
RBI data showed money sent under LRS for studies abroad grew about four-fold in September to $118 million from $29 million in the same month last year.
Payments for travel grew from 0.8 million in September 2014 to $98 million in September 2015.
The sharp rise in money sent abroad by resident Indians since July, especially for care of relatives and education, has come under RBI’s scanner. The central bank had said that besides studies abroad, remittances do rise in the months of July/August as it coincides with the new academic session. Nonetheless, the regulator was in touch with authorised dealers to get a better understanding of the underlying dynamics, it said.
There had been speculation that some Indians in the US were allegedly using LRS for resident individuals (in India) to dodge US tax agencies. The US government has passed the Foreign Account Tax Compliance Act (Fatca) to unearth black money of US residents outside the country.
The investment into overseas debt and equity under LRS was $33.2 million in September 2015 up from $16.1 million a year ago.