Dubai debt crisis could affect India's foreign trade: Survey
Last updated: 25 February, 2010
New Delhi, Feb 25 (PTI) 12:34 IST
The Dubai debt crisis is likely to have 'some impact' on India's exports and imports as the gulf region is the country's largest trade partner, the Economic Survey 2009-10 has said.
"There could be some impact on India's exports and imports, keeping in view the significant share of the UAE in India's international trade," the survey said.
The financial crisis in Dubai erupted in November last year with the conglomerate Dubai World asking creditors for six months to repay USD 59 billion debts.
The United Arab Emirates (UAE) accounts for about 10 per cent of India's USD 490 billion total trade in 2008-09. While imports from the region amounted to USD 23.79 billion, exports were at USD 24.47 billion, according to official figures.
Besides, the Survey said, remittances would also be impacted by the Dubai crisis.
The Gulf accounts for nearly one-third of total remittances into the country and 40 per cent of the population in the region is comprised of Indians. The total money remitted to India in 2008-09 was USD 46 billion.
"Indian expats comprise a large percentage of the total workforce in Dubai, the crisis may lead to salary cuts or job losses for Indian workers in the construction sector with consequent effect on remittances and NRI deposits," it said.
However, the Survey said, the impact of the crisis on India's realty sector would be "modest".