Money flow to Kerala still solid despite crisis

Thiruvananthapuram: Kerala may be the only state in India to feel the maximum impact of the global econ-omic downturn, but remittances from the state's expatriates have not shown a decline yet, according to studies.

NRI accounts in the state's commercial banks recorded an uptick during the past year —when there were reports of job losses across the world. A recent survey by the Centre for Development Studies (CDS) here confirms that the remittances are still in positive territory.

However, the survey also revealed the woes of Keralite expatriates, an estimated 37,000 emigrants rendered unemployed owing to the financial crisis.

The large majority of Kerala emigrants, whose total number is estimated to be more than two million, are presently based in the Gulf.

Return-migration

The findings of the study by CDS' K.C. Zachariah and S. Irudayarajan revealed an ongoing emigration and return-migration among Keralites, irrespective of the financial crisis gripping the world.

Interestingly, many non-resident Keralites have returned for reasons other than recession in the countries where they are based.

While cash remittances to the state actually rose seven per cent during the period of their study, covering 2008-09, family members of expatriate Keralites remain worried, with companies around the world resorting to layoffs or salary cuts.

Families that had been receiving remittances suddenly found these drying up during 2009.

A long-term drop in remittances is expected to affect the Kerala economy, known for the strength it draws from foreign remittances, as well as for its consumerist nature. A drying up of the remittance pipeline can lead to serious consequences for the state's economy, including a further setback to the property.

• 37,000 estimated jobless
• 7% rise in remittances