DBS Bank chief executive Tan Su Shan has pointed to the strong response to FCNR(B) deposits as evidence that global investors still see India as a credible destination for savings and capital, even amid recurring worries about outflows and currency volatility. Speaking in remarks that combined banking, macroeconomics and technology, Tan said the appetite for foreign currency non-resident deposits underscores confidence in India's financial system and its long-term growth story.
FCNR(B) Signals Confidence
Tan's comments come at a time when India's external sector is under close scrutiny. The rupee has faced periodic pressure from global risk aversion, shifting interest-rate expectations and uneven portfolio flows, prompting questions about how durable foreign capital support will be. Against that backdrop, FCNR(B) deposits — a channel through which non-resident Indians place foreign currency funds with Indian banks — have emerged as a useful barometer of trust.
Her argument was straightforward: if overseas depositors are willing to park funds in India through such instruments, it suggests that confidence has not weakened materially. That matters because FCNR(B) inflows can help banks raise stable foreign currency resources while also signaling that India retains credibility among global savers, particularly in periods when capital markets are volatile.
The broader policy implication is that India cannot rely on one source of external support alone. Tan stressed that the country needs more foreign direct investment and stronger exports if it wants to sustain rupee stability over time. FDI brings longer-duration capital, technology transfer and industrial capacity, while exports generate foreign exchange earnings that reduce dependence on short-term flows. Together, they form a more resilient external balance than portfolio inflows or deposit mobilization alone.
FDI, Exports, Rupee Stability
Her remarks align with a long-standing concern among economists and policymakers: India's growth ambitions require not just domestic demand and financial inflows, but also a stronger external earnings base. A currency under pressure can complicate inflation management, raise import costs and make foreign borrowing more expensive. For a large emerging economy seeking to deepen manufacturing and services exports, the quality of capital matters as much as the quantity.
Tan's emphasis on FDI is especially notable because foreign investment is often seen as a vote of confidence in policy consistency, market depth and infrastructure readiness. In contrast to short-term flows that can reverse quickly, direct investment tends to be more durable and tied to operational commitments. Her comments suggest that India's next phase of external strength will depend on attracting more such long-term capital, not merely on episodic inflows.
At the same time, she linked India's financial resilience to its technology trajectory. Tan said the country has significant potential in artificial intelligence because of its deep software talent and expanding digital infrastructure. India's advantage, in her view, lies not only in being a large consumer market for AI tools, but also in its ability to build and deploy them at scale through a skilled engineering base and a mature digital public architecture.
AI Opportunity, Hardware Gap
Yet Tan also pointed to a structural gap that could shape how far India can go in the AI race: software strength alone will not be enough. She noted the importance of improving hardware capabilities alongside software talent, a reminder that advanced computing depends on chips, servers, data centers, power reliability and broader industrial capacity. Without that physical backbone, software-led innovation can struggle to translate into globally competitive AI systems.
That observation carries weight for India's policy debate. The country has made visible progress in digital payments, identity systems and online service delivery, but AI leadership will require more than app-layer innovation. It will demand investment in compute infrastructure, semiconductor ecosystems, advanced manufacturing and energy-intensive digital capacity. Tan's comments therefore place India's AI ambitions within a wider industrial context, where finance, trade and technology are increasingly interconnected.
For DBS, one of Asia's most prominent banks, the message also reflects a broader reading of India's place in the global economy. The country remains attractive, but sustaining that appeal will require a steady mix of capital inflows, export growth and infrastructure upgrades. FCNR(B) demand may be a reassuring signal, Tan suggested, but it is not a substitute for the deeper structural work needed to anchor the rupee and support the next leg of India's growth.