NRG deposits in Guj banks grow by 8.74%

In the storm of the global recession, Gujarat has remained NRGs’ preferred shelter for their hard-earned money, with their deposits in the state’s banks increasing by 8.74% in 2008-09. Now, NRG deposits stand at Rs21,244 crore; the figure was Rs19,535 crore in the previous fiscal.

“Most NRI deposits in Gujarat are made by Gujaratis residing in the US, Europe and Africa,” said Mukesh Jain, general manager, Gujarat circle, Dena Bank, and the convener of the State-Level Bankers’ Committee (SLBC). “In FY09, the US and Europe were reeling from recessionary pressure. However, the global gloom has not deterred NRGs from saving and diverting some funds to fixed deposits (FD) in Indian banks.”

As for the state’s banks, the domestic-deposits base in Gujarat increased too, by 23.92% in 2008-09. The base accounted for Rs1,91,871 crore in the current fiscal, against Rs1,54,832 crore in FY08. In the total deposit base, the contribution of NRIs has come down to 11.07%, from 12.61% in the previous fiscal.

But, India continues to retain NRGs’ confidence. “Compared with the developed countries, India is a safer place for investments in this time of turbulence,” said Narahari Rao, AGM, Network 1, the State Bank of India. “The return on investment is also higher in India.” Among the 26 districts in the state, Kutch has cornered the highest NRI-deposit share, Rs4,183 crore. However, when it comes to the growth in NRI deposits, Ahmedabad is way ahead of other districts, with a growth rate of 27.79%. Kutch, Ahmedabad, Vadodara, Anand and Navsari are the top five districts, attracting 68% of the total NRI deposits in the state.

“In some districts, at least one member of a family lives in a foreign country. In such cases, the NRI-deposit base is much higher,” said the general manager of the Union Bank of India, VA Mendonsa.