Want Umrah? The cost is rising since Riyal rates expensive

By | 25 October 2021 09:36:48 | 149 | 0
picture by: Al-Jazeera
picture by: Al-Jazeera

The Government of Saudi Arabia has finally reopened the door to Umrah worship for Indonesians, although it is not yet certain when the departure will be made, because it is still in the maturation stage. But one thing that can be a record, the cost of Umrah this time is more expensive, as well as the riyal rate that is rising this year.


Chairman of the Muslim Association of Hajj and Umrah Organizers of the Republic of Indonesia (Amphuri) Firman M Nur said regarding the cost, before the Covid-19 pandemic, the cost of Umrah was cheaper, but after being allowed in November last year, the cost swelled due to the need for health protocols.


"Before the pandemic it cost Rp 20 million, when the November to February trials rose to Rp 26 million. We hope rp 26 million is enough to be able to carry out safe Umrah with minimal service standards," Firman told CNBC Indonesia, Tuesday (12/10/21).


Meanwhile, the riyal rate today is in the range of Rp 3,790 / SAR, stagnant compared to Tuesday's closing price. But when viewed so far this year, the riyal strengthened 1.3%.


The strengthening could be even sharper if the U.S. dollar strengthens in the rest of the year. Therefore, the U.S. central bank (Fed) will taper or reduce the value of the asset purchase program (quantitative easing / QE).


Markets expect the Fed to announce tapering next month, and first in December.


The tapering has the potential to make the U.S. dollar strong and the rupiah depressed. Riyal rates can get more expensive.


Saudi Arabia has been implementing a fixed exchange rate policy of the riyal against the U.S. dollar since 1986. $1 is set at 3.75 riyals.


With this policy the rise and fall of the riyals against the rupiah becomes exactly the same as the US dollar against the rupiah, albeit with a different percentage. Regardless of the economic condition of Saudi Arabia, the movement of its currency will always copy paste of the US dollar.


In addition to the swollen costs, for pilgrims who will leave for Umrah, it is necessary to complete several administrative requirements, including in the case of vaccinations.


Although it does not rule out the possibility that the number of pilgrims who will depart is reduced from what was supposed to be Umrah at the beginning of last year.


"Pilgrims delayed 62 thousand people and there is data requested, how many of them canceled, it does not rule out the possibility with a waiting period of 2 years many have canceled as well, although not all can be canceled because many of their funds have been paid to third parties, such as airlines deposits, hotel deposits, transportation deposits, and others," firman said.