Changing Dynamics of India’s Remittances

Why in News?

Reserve Bank of India’s (RBI’s) March 2025 bulletin shows that there has been a gradual shift in the dominance of India’s remittances away from Gulf Cooperation Council (GCC) countries.

• The data shows that the growth of remittances from Advanced economies (AEs), outpaced that of the GCC, resulting in more money coming in from these countries.
• Advanced economies (AEs), particularly the US, the UK, Singapore, Canada, and Australia, together accounted for more than half of India’s remittances in 2023-24 (FY24).
• It reflects a shift in migration patterns towards a skilled Indian diaspora.
• The US remained the largest contributor to India’s total remittances, with its share rising to 27.7% in FY24 from 23.4% in 2020-21 (FY21).
• 78% of Indian migrants in the US are employed in high-earning sectors such as management, business, science, and arts.

India’s inward remittances have more than doubled from $55.6 billion in 2010-11 to $118.7 billion in 2023-24.

• The Gulf Cooperation Council (GCC) countries like United Arab Emirates (UAE), Saudi Arabia, Kuwait, Qatar, Oman, and Bahrain — contributed 38% of the total remittances received by India in FY24.
• UAE maintained its position as the 2^nd-largest source of India’s remittances, with its share increasing from 18% in FY21 to 19.2% in FY24.
• The UAE is the largest hub for Indian migrant workers, primarily engaged in blue-collar jobs dominated by the construction industry, followed by healthcare, hospitality, and tourism.
• Higher remittances received from the US despite a lower number of migrants compared to the UAE.
• Share of inward remittances from the UK also increased to 10.8% in FY24 from 6.8% in FY21, which may be attributed to the Migration and Mobility Partnership between India and the UK.
• The study also noted a marked uptick in the share of remittances from Singapore (6.6%), Canada (3.8%), and Australia (2.3%) in FY24 compared to the pandemic year (FY21).

Reference

Business Standard | India's top remittance hubs