Mumbai continues to be the most expensive city for expatriates in India – Mercer

~Ranks higher at 57 (up from rank 82 in 2016) and more expensive than cities like Auckland (61), Dallas and Paris (62), Canberra (71), Seattle (76) and Vienna (78) of the world


Mercer’s annual Cost of Living Survey finds African, Asian, and European cities dominate the list of most expensive locations for working abroad


  • Luanda, the capital of Angola, leads as the world’s costliest city to live in Mercer’s 2017 Cost of Living Survey
  • Within India, Mumbai continues to be the most expensive city for expatriates
  • Mumbai (57) is ranked higher and more expensive than cities like Auckland (61), Dallas and Paris (62), Canberra (71), Seattle (76) and Vienna (78) of the world.
  • UK, UAE and Kenya have the highest expected increase in the number of Indian international assignees


Mumbai: According to Mercer’s 23rd annual Cost of Living Survey, Mumbai (57) is India’s most expensive city for expatriates, inching closer to break into the top 50 most expensive cities in the world. New Delhi, ranked 99, has moved into the top 100 category, Chennai (135), Bangalore (166) and followed by Kolkata (184). Mumbai (57) is ranked higher and more expensive than cities like Auckland (61), Dallas and Paris (62), Canberra (71), Seattle (76) and Vienna (78) of the world. It has moved 25 notes up from being ranked 82 in 2016.


New Delhi and Mumbai have become more expensive, over last year, and their rankings have gone up substantially. “Residential rental prices increased in Mumbai and New Delhi. Due to demonetization, real estate sales market has been severely hit. However, the rental market benefitted from the consumers’ sudden withdrawal from the purchase market, thereby putting pressure on rental prices” said Ruchika Pal, India Practice Leader, Global Mobility at Mercer.


Mumbai’s jump in ranking is also attributable to surge in prices of food and personal care. Inflation, amongst the highest in Indian cities, moved from 4.81% to 5.57%, during this period, in Mumbai. Overall, while inflation in India has been maintained, over the last few years, prices of expat food items such as cheese, butter, fish, meat etc have increased significantly. Prices for fruits and vegetables such as onions, tomatoes, lettuce and pineapple have also shown increase. Mumbai is also the most expensive cities in India on account of transportation, which includes taxi fares, cost of auto and auto parts as well as running costs.


Overall, Indian cities have moved up the global ranking substantially, not just on account of internal factors, but additionally due to some cities falling in rankings, globally, on account of currency volatility especially in Egypt, Turkey and United Kingdom.


City Rank as of March 2017 Rank as of March 2016
MUMBAI 57 82
NEW DELHI 99 130
CHENNAI 135 158
KOLKATA 184 194


Despite volatile global markets and growing security issues, organizations continue to leverage global expansion strategies to remain competitive and to grow. With a large number of Indian multinational organisations progressively expanding their footprint abroad, 71% of them are expecting expatriate assignments to increase over the next two years to address business needs as well as build careers and build leaders. Indian MNCs continue to send assignees largely from Headquarters to Subsidiaries” said Ruchika Pal, India Practice Leader, Global Mobility at Mercer.


Costs of goods and services get impacted by shift in inflation or by currency volatility, both in the home and host cities, thereby directly impacting overseas assignment costs. “In balancing organisation’s appetite to globalization and increasing cost pressures, accurate and transparent expat data such as cost of living indices, can be a useful”, she added.



Mercer’s 23rd annual Cost of Living Survey finds that factors like instability of housing markets, inflation for goods and services and foreign exchange fluctuations contribute to the overall cost of doing business in today’s global environment.


The Survey finds that Asian and European cities – particularly Hong Kong (2), Tokyo (3), Zurich (4), and Singapore (5) – top the list of most expensive cities for expatriates. The costliest city, driven by cost of goods and security, is Luanda (1), the capital of Angola. Other cities appearing in the top 10 of Mercer’s costliest cities for expatriates are Seoul (6), Geneva (7), Shanghai (8), New York City (9), and Bern (10). The world’s least expensive cities for expatriates, according to Mercer’s survey, are Tunis (209), Bishkek (208), and Skopje (206).


Mercer’s authoritative survey is one of the world’s most comprehensive, and is designed to help multinational companies and governments determine compensation allowances for their expatriate employees. New York is used as the base city and all cities are compared against it. Currency movements are measured against the US dollar. The survey includes 209 cities across five continents and measures the comparative cost of more than 200 items in each location, including housing, transportation, food, clothing, household goods, and entertainment.



In a rapidly changing world, mobility has become a core component of multinational organizations’ global talent strategy. To support the growing number of international assignees working in an increased number of locations, organizations are focusing on evaluating assignments from a cultural perspective, preparing for regional and lateral moves, and modifying compensation approaches to stay competitive. As organizations grapple with these challenges, they are working hard to accommodate the needs of their workforce and to support employees’ careers. A top priority for Indian employees, according to Mercer’s 2017 Global Talent Trends Study-India, is fair and competitive pay as well as opportunities for promotion. While on the one hand, companies are trying to employee priorities, on the other hand, cost of expat packages is a cause of concern.


According to Mercer’s International Policies and Practices Report- India, 88% of the companies in India pay a Cost of Living allowance to their long-term assignees either as a separately identified allowance or as part of a single expatriate allowance, covering other items in addition to goods and services in the remuneration package. 75% of these companies determine the COL allowance using an index-based approach – usually the same index is used throughout the assignment for all typical long-term assignments.


Across continents, countries with the highest current number of India assignees are United States, United Kingdom and United Arab Emirates (UAE). Across continents, countries with the highest expected increase in the number of Indian international assignees are UAE, UK and Kenya.


Cairo, Egypt, has dropped 92 ranks, from 91 to 183 and Aberdeen, United Kingdom, has dropped 61 ranks, from 85 to 146. “Egypt’s decision to allow its currency to float freely in return for a 12 billion dollar loan over three years to help strengthen its economy resulted in the massive devaluation of the Egyptian Pound by more than 100% against the US dollar, pushing Cairo down the ranking” said Ms. Constantin-Métral.


Cities in the United States are the most expensive locations in the Americas, with New York City (9) ranked as the costliest city, climbing two spots from last year. San Francisco (22) and Los Angeles (24) follow, having climbed four and three spots respectively. Among other major US cities, Chicago (32) is up two places, Boston (51) is down four places, and Seattle is up seven places. Portland (115) and Winston Salem (140) remain the least expensive surveyed cities for expatriates in the US. This has a direct impact on the cost of expatriate assignments for Indian multinationals.


Ruchika Pal, India Practice Leader, Global Mobility at Mercer said, “Overall, US cities either remained stable in the ranking or have slightly increased due to the movement of the US dollar against the majority of currencies worldwide.”


Only three European cities remain in the top 10 list of most expensive cities for expatriates. Zurich (4) is still the most costly European city on the list, followed by Geneva (7) and Bern (10). Moscow (14) and St. Petersburg (36) surged fifty-three and one hundred and sixteen places from last year respectively, due to the strong appreciation of the ruble against the US dollar and the cost of goods and services. Meanwhile, London (30), Aberdeen (146) and Birmingham (147) dropped thirteen, sixty-one and fifty-one spots respectively as a result of the pound weakening against the US dollar following the Brexit vote. Copenhagen (28) fell four places from 24 to 28. Oslo (46) is up thirteen spots from last year, while Paris fell eighteen places to rank 62.


Ranking 17, Tel Aviv jumped two spots from last year and continues to be the most expensive city in the Middle East for expatriates followed by Dubai (20), Abu Dhabi (23), and Riyadh (52), which have all climbed in this year’s ranking. Jeddah (117), Muscat (92), and Doha (81) are among the least expensive cities in the region. Cairo (183) is the least expensive city in the region plummeting ninety-two spots from last year, following a major devaluation of its local currency.


Five of the top 10 cities in this year’s ranking are in Asia. Hong Kong (2) is the most expensive city as a result of its currency pegged to the US dollar, which drove up the cost of accommodations locally. This global financial center is followed by Tokyo (3), Singapore (5), Seoul (6), and Shanghai (8). The strengthening of the Japanese yen along with the high costs of expatriate consumer goods and a dynamic housing market pushed Japanese cities up in the ranking.


Elsewhere in Asia, Bangkok (67) jumped seven places from last year. Jakarta (88) and Hanoi (100) also rose in the ranking, up five and six places, respectively. Karachi (201) and Bishkek (208) remain the region’s least expensive cities for expatriates.

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