Nitaqat' unlikely to affect NRI funds flow to Kerala: Banker

THIRUVANATHAPURAM: The 'Nitaqat' policy being pushed by Saudi Arabia for phased indigenisation of the workforce in the Gulf country is unlikely to sharply reduce flow of inward remittances from Non-Resident Keralites, according to a lead banker in the state.

"As of this point, we don't think that there is going to be a major deviation in flow of remittances on account of this development," said Nanda Kumaran, MD of State Bank of Travancore (SBT).

The indigenisation of labour has been a continuing process in many Gulf countries but it is unlikely to seriously affect Keralites working in the Gulf as majority of them were skilled workers, Nanda Kumaran told a press meet here last evening.

"Of course, there could be a slight slowdown in flow of funds. But it would take some time to assess the impact," he added.

According to the State Level Bankers Committee (SLBC), the co-ordinating forum of scheduled commercial banks, total NRE (Non-Resident External) deposits in banks in the state stood at Rs 62,709 crore as on December 31 2012.

This is higher by 36.5 per cent from the corresponding period of 2011, when the NRE deposits in banks (excluding co-operatives) stood at Rs 45,937, SLBC sources said.

According to the state economic review, NRE deposits accounted for nearly 25 per cent of total deposits in banks in the state.