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.”

 

Inward remittances, accounting for around 3% of India’s GDP, surged 12% from 2021.

 

 

Besides a large working population of Indians living abroad, there were other reasons, too, for this increase. For instance, students are the other big constituents of the Indian diaspora. They eventually form high-income groups, with direct implications for remittances.

 

The depreciation of the Indian rupee has also helped. Since January, the currency has fallen 10% against the dollar. This has made sending money from South Africa to India cheaper by 26%, from Thailand by about 17%, and from Japan by 14% in the past year or so, the World Bank has said.

 

Structural shift in migration from India

Between January 2015 and September 2021, up to 8,81,254 people gave up their Indian citizenship. The trend accelerated post-pandemic after countries like Canada, New Zealand, Germany, and Ireland relaxed their immigration policies to attract skilled workers.

 

Such relocation has moved from the Arabian Gulf earlier, for often low-skilled and informal employment, to developed countries such as the US and UK for high-skilled jobs.

 

 

In 2020-21, the US became the largest remitter to India due to large stimulus packages and wage hikes in that country during the pandemic months and after.

 

Read More: ESIC to invest up to 15 percent surplus funds in equity through ETFs

 

“The structural shift in qualifications and destinations has accelerated growth in remittances tied to high-salaried jobs, especially in services,” the report said.

In a bid to accrue better returns on its surplus funds, the government, on Sunday, allowed Employee State Insurance Corporation (ESIC) to invest up to 15 percent of its surplus funds into equity through exchange-traded funds (ETFs).

 

The decision was taken at an ESIC meeting chaired by the Union labour minister Bhupender Yadav at the corporation’s headquarters in New Delhi.

 

A labour ministry statement said that the decision to invest surplus funds into equity was taken due to the low returns on debt instruments and the need to diversify the corporation’s portfolio. Initially, the investment will be restricted to exchange-traded funds.

 

 

“The initial investment shall start at 5 percent and increase up to 15 percent gradually, after a review of two quarters. The investment will be confined to ETFs, i.e., Nifty50 and Sensex. It will be managed by fund managers of Asset Management Companies (AMCs). The equity investment will be monitored by existing custodian, external concurrent auditor, and consultant looking after the debt investments in addition to the management of the ETF for equity”, the statement said.

 

Besides, the minister also emphasized strengthening the infrastructure at ESIC hospitals and dispensaries and approved the setting up of a new 100 bedded ESIC Hospital at Shyamlibazar, Agartala, Tripura, and Idukki.

 

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Further, it was also decided to execute the capital works in ESIC through Central / State PSUs besides the Central Public Works Department (CPWD). A fresh empanelment of such central / state PSU will be invited by the ESIC for empanelment in due course.