India has historically been one of the biggest recipients of remittances in the world. The contributions of NRIs based in the UAE are really high. As per the information available, UAE is the biggest source of remittances to India, followed by Saudi Arabia. Most of these people send money to invest in the country.
You are missing a golden opportunity if you are not sending money to India to invest. The primary reason you must start thinking about investing in India is for retirement. When it comes to retirement, most NRIs want to spend their sunset years in their native place. If you also dream of the same, you need to start planning for it – NOW. Even if you are not looking to return to India, one cannot miss out on the return that India provides.
Being an Indian, you must take advantage of the growing economy back in your country. Investment is a number game, and hence we will give you numbers to make you understand why and where you should invest your money:
Savings account: If you keep your hard-earned money in Dubai in a savings account in the local bank, you are losing money big time. Most banks in Dubai offer less than 1% interest in the savings account. In India, most banks offer an interest rate of 3% or more. Some banks offer interest rates of up to 5%.
How much of a difference will it make? Let us assume you have Rs 1,00,000 in your savings account. If you keep the same money in a savings account in Dubai, to earn an additional Rs 50,000 on your investment, you will have to wait for 50 years. However, you can get the same with a 5% savings account interest rate in 5 years. Based on these data, you will double-think before keeping your money in a local bank.
Fixed Deposits: To earn even higher interest without any risk, you can plan to invest your money in fixed deposits. Some of the banks in India can give you an interest rate of 6% on your fixed deposit accounts. We are in an increasing interest rate cycle. Hence, one can expect higher interest rates in the coming months. Banks in Dubai won’t be offering you more than 2% on fixed deposits. Some banks may offer slightly higher interest rates, but the lock-in period and minimum investment will be high to achieve it.
Direct Equity and Portfolio Management Schemes: The Indian equity market has been generating returns for domestic and institutional investors for years. In the last five years, NIFTY50 has given over 65% returns to investors (1 Feb 2023). Please note that this is after the recent correction in the market. You can get help from financial advisors who can help you invest in specific stocks or portfolio management schemes, and help you earn higher returns.
We at Right Horizons have been managing equity portfolios for hundreds of clients and have our PMS schemes have been able to generate good returns for our clients.
The Indian equity market allows you to invest in stocks from different categories, which helps in diversification. Investing in the equity market can help you create wealth faster, and you can retire early and settle in the place of your choice in your twilight years.
Mutual funds: If you think that direct equity investment is risky and does not suit your profile, you can explore the advanced Indian mutual fund market. We have 44 registered mutual fund houses in India that offer more than 2500 different mutual fund schemes. You can invest in a mutual fund via a Systematic Investment Plan (SIP) by sending money to India regularly.
National Pension Scheme (NPS): It is another excellent option for retirement planning that NRIs from Dubai can explore. You can invest in NPS if you hold Indian citizenship. NPS is a decent long-term retirement-oriented investment option that can take care of your retirement years. You must know that you cannot withdraw money from your NPS account before you turn 60.
Banks and exchange houses in Dubai offer hassle-free and convenient ways to remit money to India. You must make the most of it by sending the money to India and investing in different financial instruments that can help you grow your capital.
With the right investment choices, you can create a financial cushion to fall back on. Identify the products and asset classes that suit you and your investment style. Investing in different products is the right way – you reduce portfolio risk by diversifying your portfolio.
If you need any help, you can always get in touch with us. We will be more than happy to assist you. We ensure our clients enjoy their present while we take care of their future.
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