Rising outward remittances rise from Andhra Pradesh as NRIs liquidate properties

Overall, the combination of generational shifts, practical considerations, and legislative concerns is driving a notable trend among NRIs to sell their properties in Andhra Pradesh, resulting in a marked increase in outward remittances from the state

PRAVASISAMWAD.COM

In recent years, Andhra Pradesh, once a significant contributor to India’s inward foreign remittances, has seen a notable shift in financial trends. Many Non-Resident Indians (NRIs) are increasingly selling off their properties in the state, leading to a rise in outward remittances. This change in trend, although slightly slowed after a change in the state’s regime, continues to grow overall.

Andhra Pradesh is among the Indian states with a substantial NRI population, following Kerala, Punjab, Maharashtra, and Gujarat. For years, it has been a top recipient of foreign remittances, particularly from the USA. However, many NRIs who moved to the USA during the late 1990s, especially those who benefited from the information technology boom, are now selling their properties in Andhra Pradesh, including both self-acquired assets and ancestral inheritances. This shift reflects their decision to settle permanently in the United States.

A significant factor contributing to this trend is the difference in emotional attachment to the properties. Many NRIs who migrated had agricultural backgrounds and maintained a strong emotional connection to their land in India. In contrast, their children, born and raised in the USA, do not share the same attachment to these properties. Additionally, with the older generation either having passed away or unable to manage the properties, many NRIs find it impractical to retain them. Peddi Ramana, an NRI from Dallas, recently liquidated six properties in and around Nuzividu and Vijayawada, stating that neither he nor his children have any intention of returning to India, prompting the decision to sell.

There is a growing preference among the present generation for investing in liquid assets rather than real estate. Krishna Mohan V, originally from Gudivada and now residing in Michigan, recently sold his assets in Vijayawada

The Land Titling Act, proposed by the previous YSRCP government, also played a role in accelerating property sales among NRIs. Some provisions of the act created apprehensions, prompting many NRIs to consider liquidating their properties rather than facing potential legal and financial uncertainties. According to banking officials, outward remittances by NRIs have surged, particularly after the implementation of the Land Titling Act. A manager at a leading private bank with numerous NRI clients noted that remittances were minimal before the COVID-19 pandemic but have increased significantly since, further spiking post-act.

This sentiment is echoed by another private bank manager, who highlighted that fears surrounding the Land Titling Act led many risk-averse investors to start liquidating their properties.

He believes that while land prices in Andhra Pradesh have appreciated over time, the growth prospects for the state do not align with the expected future growth of land values. “This may be the right time to book profits and explore new investment opportunities,” he commented.

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