Around 18 million Indians make up the largest diaspora community in the world. As a result, India has over the years gotten an increasing amount of remittances.
According to World Bank data (pdf), the amount reached $100 billion in 2022, making the nation the first ever to do so. According to a Nov. 30 World Bank press release, “remittance flows to India were strengthened by the wage hikes and a healthy labour market in the United States and other OECD nations.”
Remittances from abroad, which make up about 3% of India’s GDP, increased by 12% since 2021.
There were other causes for this surge as well, in addition to the enormous number of Indians who were working abroad. For instance, the Indian diaspora also includes a sizable number of students. Their eventual formation of high-income groups will directly affect remittances.
The Indian rupee’s decline has also been beneficial. The currency’s value against the dollar has dropped 10% since January. According to the World Bank, this has reduced the cost of sending money to India from South Africa by 26%, Thailand by roughly 17%, and Japan by 14% during the previous year or so.
Change in migration patterns from India
The number of people who renounced their Indian citizenship reached 8,81,254 between January 2015 and September 2021. Following the epidemic, the trend picked up speed as nations like Canada, New Zealand, Germany, and Ireland loosened their immigration regulations in an effort to attract qualified workers.
Earlier, similar relocation occurred from the Arabian Gulf to industrialised nations like the US and UK for high-skilled occupations, leaving the Arabian Gulf for frequently low-skilled and informal employment.
Due to significant stimulus packages and pay increases in India during and after the outbreak, the US overtook other countries as the leading sender of money to that country in 2020–21.
The structural change in requirements and destinations, particularly in the service sector, “has spurred growth in remittances connected to high-salary jobs,” the paper stated.
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