Advanced Economies' Remittances to India Outpace Inflows from the Gulf: RBI

According to the RBI March Bulletin, which was published on 18 March, the share of inward remittances from developed economies—such as the US and the UK—has increased and has overtaken that of Gulf economies in 2023–2024. This indicates a change in the migration trend towards the skilled Indian diaspora. Between 2010–11 and 2023–24, India's remittances more than doubled, from $55.6 billion to $118.7 billion. Net remittance receipts have been a significant buffer against external shocks throughout this time, helping to finance about half of India's merchandise trade imbalance. A Bulletin article titled "Changing Dynamics of India's Remittances – Insights from the Sixth Round of India's Remittances Survey" examines a number of aspects of inward remittances to India, including the source of remittances by country, the destination of remittances by state, the size of remittances by transaction, and the most common modes of transmission.

Rise in Indian International Migrants

India's stock of foreign migrants tripled from 6.6 million in 1990 to 18.5 million in 2024, and its percentage of all migrants worldwide increased from 4.3% to more than 6% in the same time frame, it was reported. Approximately half of all Indian migrants worldwide reside in the Gulf Cooperation Council (GCC) nations. As the dynamics of India's diaspora have changed over time, advance economies (AEs) have also become a significant source of inward remittances to India in addition to GCC nations.

It stated that India would become the world's largest supply of labour since its working-age population is predicted to increase until 2048. According to the article, the survey's findings show how India's remittances from the GCC countries have gradually shifted to the AEs, especially the US, UK, Singapore, Canada, and Australia, which together accounted for more than half of the remittances in 2023–2024. 30 AD banks (representing approximately 99% of the total inward remittances reported for family maintenance and savings), two significant Money Transfer Operators (MTOs), and two fintech companies engaged in cross-border remittance business were included in the sixth round of the survey on inward remittances for 2023–2024.

US Tops the List

The United States continued to hold the greatest share of India's total remittances, increasing from 23.4% in 2020–21 to 27.7% in 2023–24. Additionally, the percentage of inward remittances from the UK rose from 6.8% in 2020–21 to 10.8% in 2023–24. After rising from 18% in 2020–21 to 19.2% in 2023–24, the United Arab Emirates (UAE) continued to be the second-largest source of remittances from India.

The UAE is the biggest destination for Indian migrant workers, who are mostly employed in blue-collar occupations, which are dominated by the construction sector, followed by the hospitality, tourism, and healthcare sectors. According to the survey, this stands in sharp contrast to the US, where Indian migrants are primarily employed in white-collar positions. In 2023–24, Maharashtra had the biggest proportion (20.5%); however, it was less than in 2020–21 (35.2%). Kerala came next, with its share rising from roughly 10% to 19.7% over the same time period. Tamil Nadu (10.4%), Telangana (8.1%), and Karnataka (7.7%) were next in line.