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Global crisis may impact NRI investments in Punjab
Thursday, Oct 16, 2008

Punjab, as many of the Indian states may be negatively affected by the financial crisis in the US. Many NRIs of Punjabi origin have set up trusts and charities to enhance the health, education and social infrastructure in Punjab. Besides, remittances (estimated at US $ 2 to 3 billion per year) are contributing to an enrichment of the state (World Bank, 2004)
Also deeply affected will be the large number of NRI-backed philanthropic projects in Punjab. NRI investments include those like developmental projects like schools, hospitals and village infrastructure. A survey conducted by a Jalandhar-based organization, Vichar Manch, in 2002 of 477 villages located in seven tehsils of the Doaba region showed that NRIs had contributed more than Rs.2 billion in the 477 villages. That is about Rs.4 million per village. NRIs have been contributing for setting up educational institutions, dispensaries, hospitals, crematoriums, sports stadiums, street lighting, sanitation, and clean drinking water projects. A depression in the US economy will of course mean a corresponding scarcity of these funds that the Punjabis used to dip in. As it is, the NRIs always have some doubt about the way funds are spent in India. Naturally, they will be doubly careful before sending money at a time when immediate needs closer home will require a monetary response.

There has always been a close relationship between the progress of the Diaspora and the progress of Punjab. It is generally believed that in many countries Punjabi migrants have higher income levels than the average Indian migrant, who in turn have a higher income level than the national average of host countries. The Punjabi migrants maintain their own cultural and linguistic heritage and preserve their links with the families in Punjab. In times of meltdown and jobs on the line, Punjab is clearly set to feel the heat from the troubled US markets.



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