In the past, many NRIs invested in Indian real estate by channeling U.S. dollars into India through hawala networks, bypassing formal banking channels. Today, that trend appears to be reversing.
A growing number of NRIs who purchased properties in India, or inherited ancestral properties, are looking to sell them and move the proceeds back to the United States.
For many, these assets were originally retained because their parents continued to live in India. However, once the parents pass away, the practical and emotional ties to India often weaken significantly.
The children of many NRIs, having been born and raised abroad, frequently have little interest in returning to India or maintaining property there. As a result, families increasingly view such properties as non-essential assets rather than long-term holdings.
When property sale proceeds are transferred through legitimate channels, sellers may face substantial transaction costs, compliance requirements and tax obligations in both India and the United States.
To avoid these burdens, some reportedly turn to informal hawala networks, seeking to receive equivalent amounts in U.S. dollars outside the formal financial system.
Under such arrangements, funds generated from property sales in India are matched against cash pools available in the United States.
Businesses that handle large volumes of cash, such as certain retail establishments, are often alleged to play a role in facilitating these transactions because they can more easily absorb and circulate cash within informal settlement networks.
Whatever the scale of this activity, the broader phenomenon is noteworthy. A flow that once largely moved money from the United States into Indian assets is, now moving in the opposite direction.
The reasons have changed. Earlier, NRIs kept properties in India for investment and family reasons.
Now, many are selling those properties, settling inheritance matters, and trying to move their money back to the USA where they live. This is the opposite of the earlier trend, when money was flowing from abroad into Indian real estate.
