Dubai — After the disastrous earthquake on April 25, remittances to Nepal increased by more than 25 per cent in May compared to previous month and these will be key to rebuild the small Himalayan country’s ravaged economy, top officials of UAE exchange houses told
More than two million Nepalese work overseas and most of them are in Saudi Arabia, Qatar and the UAE. The UAE is home of around 300,000 Nepalese expatriates. On an average Nepal receives about $500 million per month in remittances. The amount has increased substantially in the wake of the earthquake.
Nepal is among the best in the world when it comes to remittances received as a proportion of the country’s gross domestic product. The remittances amount contributes 25 per cent of the country’s GDP.
The Nepalese economy is highly dependent on remittance, which totalled $5.9 billion in 2014. It also accounts for nearly 30 per cent of the GDP, and is set to increase significantly, because tourism, which is their next big contributor, has also taken a hit due to the earthquake.
The economic loss caused by the earthquake is estimated to be anywhere between $1 billion and $10 billion, according to the US Geological Survey’s estimate. Rebuilding cost could easily exceed $5 billion, according to IHS estimates.
Nepal is slowly getting back on its feet after the devastating earthquake. Although the road to recovery has been difficult, the people of this mountain country have shown great determination and effort in getting life back on track. Schools are reopening, construction is progressing and repairs are being undertaken in the affected areas. In support of the Nepali diaspora, remittance houses had also waived of their remittance fees to send money to Nepal. LuLu International Exchange and UAE Exchange were one of the first responders to the disaster in terms of waving off remittance fees in all of their branches spread across the GCC countries.
“The earthquake has affected the lives of millions in Nepal, and we were touched by the gravity of the disaster. It was our duty to do our bit to help the people of Nepal and we are humbled to have been one of the first organisations to waive our remittance fees,” Adeeb Ahamed, CEO, LuLu International Exchange, told Khaleej Times.
“We noticed a 35 per cent increase in remittances to Nepal during May compared to previous month across our operations in GCC countries,” Ahamed informed. External funding will be critical to rebuild critical infrastructure that include roads, highways, power plants and even tourist attractions. Private companies have also extended relief efforts. In a show of solidarity to those affected, UAE-based Lulu Group International managing director Yusuff Ali MA had handed over 20 million Nepalese Rupees to the Nepal Prime Minister’s Disaster Relief Fund last month.
UAE’s NMC Healthcare also airlifted medical supplies worth millions of dirhams to Nepal. Its sister firm UAE Exchange also offered free remittances to Nepal. “Our group’s company had sent a lot of medicines and other necessary supplies to Nepal in addition to free remittances,” Sudhir Kumar Shetty, chief operating officer of UAE Exchange told this scribe.
Nepal’s overseas migrant workers are mostly employed in the Middle East. GCC accounts for around 50 per cent of all remittances go to Nepal, according to Shetty. Last year, UAE Exchange sent $500 million worth of remittances to Nepal in 800,000 transactions.Remittances to Nepal had gone up in the range of 20 per cent to 25 per cent last month, compared to previous month, he explained.
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