FCNR (B) deposit repayment dues could hit $170bn: Kotak

MUMBAI: Veteran banker Uday Kotak said that the repayment bill for the FCNR(B) deposits could go up to $160 to $170 bn against the $130 bn raised after factoring in interest costs.“I have no hesitation in saying that what India's policymakers between RBI and the government did was the right thing in the context of the global macroeconomic and geopolitical situation, with the world facing the Middle East conflict on top of the Russia-Ukraine conflict. I think of the FCNR(B) scheme as a strong insurance policy,” said Kotak speaking at the Business Standard BFSI summit. He also lauded the timing of the scheme which was announced before the surge in US bond yields.According to Kotak, the total foreign investment in India including foreign portfolio and foreign direct investment was around $1.5 trillion. He said that while at one level the Indian investor was acting as counterweight to foreign investors, at another level they were responsible for giving exit to the foreign investors. He explained the domestic investment surge by pointing out to the difference between the 15% capital gains tax on shares and high tax rate on interest income which could go up to 39% for large individual investors.He said that the current account would be in surplus but for the large imports of gold.You use AI every day. Now get your AI Quotient. Take the AIQ test.