With the appreciation of the Indian Rupee, its the Gulf NRI that take a beating as middle eastern currencies are pegged to the dollar. This would mean lower currency rates for the remitting NRI. Gulf NRI's overwhelmingly remit to India to safeguard their savings from work and political instability in the Middle East. Additionally, Gulf NRI's work for the short-to-medium term (5-10 years) unlike in the West where NRI's aim to take up permanent residence in their host countries. At the end of the day the Gulf NRI returns to India, therefore, requiring remittance to banks in India.
Despite what the average ignorant Indian might have to say about working in the Gulf, Gulf remittances to India provides for a large currency cushion that helps prop the government more than they or other Indians are willing to acknowledge.
Let me explains, India's current account deficit is at 3% of its GDP. Take away NRI remittances from it and the current account deficit rises to 5% of the GDP (Source: World Bank). Now do you understand the contributions NRIs (especially the Gulf variety) provide to India?
So there you go, the rising rupee will affect the Gulf Indian the most. But instead of understanding the effect of the rising rupee from this perspective (as a large proportion Gulf NRI's are from the labor class), mainstream media and Indians worry more about the hit corporations (read: Wipro, TCS, Infosys etc) will take from reduced profits as they are export oriented businesses.
