A spread of 8.9% between the best and worst India ETF this year is worth a sentence. INDY, which tracks the NIFTY 50 — the 50 largest Indian companies — is down 14.48% YTD, because the names dragging the headline indices are the same names that dominate INDY's portfolio. INDA and FLIN track broader large/mid-cap baskets (~140 and ~230 holdings) and sit in the middle of the pack. EPI does better than its cap-weighted peers because it's earnings-weighted rather than cap-weighted — money-losers get smaller positions or get screened out entirely, which provides a quality tilt that's worked in a sell-off. SMIN, the small-cap ETF, is the surprise winner of a bad year, down only 5.60% — Indian small caps have decoupled from the large-cap drawdown, a pattern worth watching if you've been writing off the "broad India" thesis.

The 6.76% YTD rupee depreciation is baked into every one of these numbers. In INR terms, INDA's underlying portfolio is down ~4–5% YTD. In USD terms — which is what you actually spend — it's down 11%. The currency did more than half of the damage. For NRIs with India exposure, this is the structural argument for currency-hedged India ETFs (none of the five above are hedged), or for FCNR-style USD-denominated holdings instead of equity in the first place.

A year of currency drag, in one chart.

In the IPL this season, a target of 200 is no longer a defendable score. Batters are chasing it down inside 18 overs with wickets to spare. The Rupee, watching from the boundary, seems to have decided it wants a piece of the action — and is accelerating toward a century of its own. At 95.97 against the dollar, it is four runs short. The crowd is not cheering this one.

A week ago, a dollar bought you ₹94.43. As of Friday's close, it buys you ₹95.97. The rupee lost 1.63% against the dollar in seven days, and 12.13% over twelve months. We wrote two weeks ago about the "quiet slide" at 94.91. The slide isn't quiet anymore — and it just accelerated.

Three forces are pulling it down at once, and none of them are easing. Crude is the loudest: Brent has been parked above $100 for most of April and May, and every $10 increase in oil costs India roughly $15 billion in additional annual import bills. The RBI has been selling dollars from reserves to defend the rupee — last week's FX reserves data showed another draw — but reserves are finite and the central bank knows it. Behind that is dollar strength on global flight-to-safety bids, with emerging market currencies taking the other side of that trade. Third, the structural backdrop: the rupee has weakened against the dollar at a compound rate of roughly 3.4–3.9% per year for a decade. The current move is that trend, accelerated.

For a US-based NRI, the math gets worse every week. Take the Mumbai apartment example from Edition 2 — bought in 2014 for ₹5.5 crore at 60.95 ($902,379), sold today at ₹7 crore. At 95.97, that ₹7 crore returns $729,395, a USD loss of 19.2% on the original investment. In the seven days since the previous Friday alone, the same hypothetical sale lost another $11,895 in USD terms. The asset didn't move. The price didn't move. Only the currency moved.

5.00% stated rate · Union Bank of India

That is the dollar-denominated yield on a 1-year FCNR (USD) deposit at an Indian bank, with full repatriability. The bank is Union Bank of India. The 5.00% you see on the rate card is the stated rate. Because FCNR interest is calculated on a 360-day year and paid semi-annually, the actual annual yield works out to 5.06% — a small but real pickup that compounds over multi-year tenors (we explain the mechanics in the deep dive below). For context, the best US 1-year CDs at major banks are currently in the 4.25% to 4.50% range, and a 1-year Treasury yields roughly 4.30%. The FCNR yield sits above both, and the interest is exempt from Indian income tax for NRIs.

Here is what most NRIs do not compute: FCNR rates are quoted in USD and funded with USD. There is no conversion in, no conversion out, no rupee depreciation risk. You are earning an India-bank rate on a US-currency balance. The deposit itself sits in an Indian bank, but your principal and interest are denominated and repatriated in dollars.

Two things to watch. First, FCNR rates are capped by the RBI at the Overnight ARR for each currency, plus 250 bps for 1-to-3-year deposits and 350 bps for 3-to-5-year deposits. Banks rarely pay to the ceiling — the gap between what they could pay and what they do pay is the bank's margin. The spread between the highest and lowest 1-year FCNR rate in our survey is 135 bps, which on a $100,000 deposit is $1,350 per year of avoidable money left on the table.

Second, FCNR has a minimum tenor of 1 year, with stiff premature withdrawal penalties (typically full forfeiture of accrued interest if closed before 1 year). It is not a liquid park. But for the slice of dollars you do not need for 12+ months, it is the single most rupee-risk-free, tax-efficient option an NRI can deploy in India.

Most NRI guidance on where to park money in India is either (a) blog content written to drive bank affiliate clicks, or (b) advice from your uncle, who has had the same FD at the same branch since 1997. Neither tells you what you actually need to know: what is the real spread between banks right now, and where does each account type — NRE, NRO, FCNR, RFC — actually win?

We pulled current 1-year rates from eight banks that actively compete for NRI deposits: the largest PSU and private banks (SBI, HDFC, ICICI, Axis, Kotak), one additional private bank (IDFC), a foreign bank with a meaningful NRI presence (DBS), and a mid-sized PSU (Union Bank of India). Here is the comparison, all four account types side-by-side.

Three observations from this table before we walk through each account type.

One: The NRE and NRO rate spreads are narrow — and identical. Both NRE and NRO range from 6.25% to 6.50%, a 25 bps gap at the top end. On a ₹50 lakh deposit, that 25 bps is roughly ₹12,500 per year. Worth picking the better bank, but not the kind of decision that moves the needle on a retirement plan.

Two: The FCNR spread is wide. Rates run from 3.65% (HDFC) to 5.00% (Union Bank of India) — a 135 bps gap, the widest of any column. On a $100,000 deposit, that is $1,350 per year in foregone interest, every year for the life of the deposit. RFC tracks FCNR almost exactly.

Three: The bank with the best FCNR rate is not the bank most NRIs would default to. HDFC, ICICI, and SBI are the names US-based NRIs reach for first — and on FCNR, they sit in the bottom half of the table. Union Bank of India and IDFC pay materially more for the same product.

NRE FDs are the default for most US-based NRIs, and for good reason: interest is tax-free in India, principal and interest are fully repatriable, and the rupee yields are 3 to 4 times what you would earn on a US savings account in nominal terms. The catch — and it is a big one — is currency. An NRE FD pays you in rupees, and the rupee has depreciated 12.13% in the last 12 months. A 7% NRE rate against a 3.5% structural currency drag is a 3.5% real USD return, before US taxes on that interest.

Looking at the table, Kotak and IDFC tie for the 1-year NRE lead at 6.50%. Five banks (SBI, HDFC, ICICI, Axis, Union Bank of India) cluster at the floor at 6.25%. DBS sits between, at 6.35%. The 25 bps spread between top and bottom is worth roughly ₹12,500 per year on a ₹50 lakh deposit. Brand and service quality should weigh as heavily as rate in the decision.

NRO is where your Indian-source income has to live: rent from that Bangalore flat, dividends from Indian stocks, your father's gift that landed in your old SBI account. It is not optional. What is optional is how much you let accumulate there.

NRO rates are tightly clustered — five of the eight banks pay 6.25%, three pay 6.35% to 6.50%. The 25 bps spread is the narrowest in our table. That is not a coincidence. NRO is a mandatory account for any NRI with Indian-source income, so banks have little incentive to compete aggressively on rate.

The nominal rates look similar to NRE. The economics do not. NRO interest is taxed at 30% TDS in India (yes, 30%, not 10%), and the principal is only repatriable up to USD 1 million per financial year, subject to documentation. You then pay US tax on the same interest, with a Foreign Tax Credit claim to avoid double taxation.

After the TDS haircut, a 6.25% nominal NRO rate becomes a 4.4% post-tax rate in India, then gets reported on your US 1040 as ordinary income with FTC offsetting the 30% you already paid. The arithmetic ends up roughly comparable to a US taxable bond fund, with worse liquidity and more paperwork.

FCNR is the one account where the math genuinely favors the NRI. It is a USD-denominated FD held at an Indian bank, with interest paid in USD, full repatriability, and no Indian tax on interest.

Looking at the table, FCNR 1-year rates run from 3.65% (HDFC) at the bottom to 5.00% (Union Bank of India) at the top. The 135 bps gap is wider than any other column. On a $100,000 deposit held for one year, choosing Union Bank over HDFC is $1,350 of additional interest. Held over a 5-year tenor with semi-annual compounding on a 360-day basis (explained below), the difference compounds to roughly $8,200.

The RBI caps what banks can offer on FCNR (B) deposits. For 1-to-3-year tenors, the ceiling is the Overnight ARR for each currency plus 250 bps; for 3-to-5-year tenors, the ceiling is ARR plus 350 bps. Banks rarely pay to the ceiling — the spread to ceiling is their margin. The 135 bps gap between Union Bank and HDFC in our survey reflects that bank-by-bank pricing choice, not differences in underlying funding costs. FCNR is a smaller deposit pool than NRE, and the banks competing for it tend to price more aggressively than on the rupee side.

A few things to understand: