Skilled Indians drive the remittances story
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Skilled Indians drive the remittances story BY HOWINDIALIVES COM India is the world s largest recipient of remittances with 119 5 billion received in 2023 India also has the largest stock of inter- national migrants in the world estimated by the United Nations at 18 5 million in 2024 followedby China at 11 7 million But while India has been a big recipient of remittances for a couple of decades now shifts are unfolding within The share of advanced economies in India s inward remittances has risen surpassing the share of Gulf economies reflecting a shift in migration pattern towards skilled Indian diaspora India s central bank said following a recent survey that tracked trends and patterns in remittances for 2023-24 As a share of gross domestic product GDP India s remittances at 3 4 is similar to that of Mexico but much lower than countries such as the Philippines about 9 of GDP For China remittances are far less important accounting for just 0 2 of its GDP Remittances will continue to be important for the Indian economy given key trends in the global population Currently India accounts for around 18 6 of the global working-age population aged 20-65 years According to UN estimates this is estimated to creep up to around 19 by Liked this 2040 bywhen the share of the working-age population in high-income and upper-middle- story income countries is projected to fall by six percentage points Thus notwithstanding a back- Share it by lash against foreign-born migrants in many high-income countries the demand for scanning the migrants to fill crucial gaps in the workforce in those countries will only persist QR code India s status as the world s largest recipient India s share of the world s working-age of remittances remains intact population is projected to keep rising Remittances received in billion top seven countries Share of world population aged 20-65 years ¦2025 12030 12040 mint 125 India Mexico Philippines France China Pakistan Bangladesh High-income upper mint middle-income countries 100 Africa 75 India 50 Least-developed countries China 0 10 20 30 40 50 60 2001 2023 Data does not add up to 100 due to overlapping categories Source World Bank Source UN Population Prospects medium-variant projection High-Income Tilt Fewer Indian migrants from advanced nations send bigger share of money IN 2023-24 the US remained India s largest source of ¦ Share of Indian migrants in 2024 remittances by country accounting for 27 7 up from 23 4 in ¦ Share of Indian remittances in 2023-24 2020-21 and 23 in 2016-17 as per the Reserve Bank of India In mint RBI Five high-income countries taken together the US the Gulf countries UK Singapore Canada and Australia accounted for about 52 of India s remittances in 2023-24 while hosting around 36 of all US migrants from this country UK In contrast the set of six Gulf countries the other major destination of migrants accounts for 45 of the number of Singapore Indian migrants but 38 of remittances Jobs in the Gulf are Canada more blue-collar in nature in sectors like construction Australia Thus on average migrants from high-income countries send New Zealand more reflecting their higher pay levels and the fact that migrants 0 10 20 30 40 50 to these countries tend to be more skilled working in white- Constitutes Bahrain Kuwait Oman Qatar Saudi Arabia and UAE collar jobs like software development Source Reserve Bank of India United Nations Maharashtra Kerala and Tamil Nadu Richer Destinations receive the largest share of remittances Share of remittances received in 2023-24 in mint MAHARASHTRA KERALA and Tamil Nadu accounted for Maharashtra about half of the remittances received in 2023-24 However Kerala Maharashtra s share fell from 35 2 in 2020 -21 to 20 5 in Tamil Nadu 2023-24 which may reflect the effects of economic conditions Telangana of covid In pre-covid 2016-17 for which RBI has published Karnataka data Maharashtra s share of remittances was 16 7 From 2016- Andhra Pradesh 17 to 2023-24 Karnataka s share fell the most from 15 to 7 7 Delhi NCT Maharashtra Telangana and Punjab accounted for the Punjab largest number of Indian students migrating abroad for Gujarat education and staying back for employment opportunities Uttar Pradesh which is reflected in the increasing share of these states in Haryana India s inward remittances RBI said in its report Others 1 It s worth noting that almost all the top recipient states for 0 lo is 10 Is remittances are relatively more prosperous with Uttar Pradesh Source Reserve Bank of Indiabeing the only lower-income state in the top 10 Remittances above zs lakh in size Size Bias dominate the total share THE RBI survey shows that about 70 of remittances are of less Share in remittances received by India in by size than 150 000 High-value remittances above 15 lakh account IF Value •Volume for 28 6 of total remittances received but only 1 4 of the total 10 7 1 5 1 4 number of remittances In other words high-skilled migrants • • earning high incomes are the main remitters to India However e • to an extent this may be an artifact of the way data is compiled The survey covers data from banks money transfer companies mint and cross-border remittance fintech firms The average cost of 15 6 15 7 sending 200 to India is around 4 9 or 10 While this is lower than the global average it may be high for 9 2 low-income workers nudging them to cheaper means of 4 6 transfers such as hawala Such remittances may not be captured in data compiled by RBI As more countries raise protectionist Z5 lakh barriers and scrutiny remittance figures should be watched 50 000 1 lakh Source Reserve Bank of India howindialives com is a database search enginefor public data PARAS JAIN MINT