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