India world’s largest recipient of remittances: World Bank

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    In News

    • According to the World Bank, India is the world’s largest recipient of remittances in the year 2021.

    Key Points

    • India received $87 billion in 2021 with the United States being the biggest source, accounting for over 20 per cent of these funds.
      • India had received over $83 billion in remittances in 2020.
    • India is followed by China, Mexico, the Philippines, and Egypt.
    • In India, remittances are projected to grow three per cent in 2022 to USD 89.6 billion, reflecting a drop in overall migrant stock, as a large proportion of returnees from the Arab countries await return.
    • Remittances to low- and middle-income countries are projected to have grown a strong 7.3 per cent to reach USD 589 billion in 2021.
    • Remittance flows from migrants have greatly complemented government cash transfer programs to support families suffering economic hardships during the COVID-19 crisis.

    Remittance

    • About:
      • Remittance refers to money that is sent or transferred to another party (country), usually overseas. 
      • Remittances represent one of the largest sources of income for people in low-income and developing nations. It often exceeds the amount of direct investment and official development assistance.
      • Remittances help families afford food, healthcare, and basic needs.
    • Rise in remittances:
      • Migration among people who choose to live abroad for jobs or studies is increasing. Therefore, many remittances are made by people who want to send money back home.
      • Businesses have increasingly relied on the internet as it makes connecting and collaborating with suppliers, employees and clients easier. This has resulted in overseas remittances paying for business invoices.

    World Bank

    • It traces its origin to the  Bretton Woods Conference, officially known as the United Nations Monetary and Financial Conference, was a gathering of delegates from 44 nations that met from July 1 to 22, 1944 in Bretton Woods, New Hampshire (USA), to agree upon a series of new rules for international financial and monetary order after the conclusion of World War II.
    • The two major accomplishments of the conference were the creation of the International Bank for Reconstruction and Development (IBRD) and the International Monetary Fund (IMF).
    • The World Bank Group is an international partnership comprising 189 countries and five constituent institutions that works towards eradicating poverty and creating prosperity. 
    • The five development institutions under the World Bank Group are:
      • International Bank for Reconstruction and Development (IBRD)
      • International Development Association (IDA)
      • International Finance Corporation (IFC)
      • Multilateral Guarantee Agency (MIGA)
      • International Centre for the Settlement of Investment Disputes (ICSID)
    • Reports and Publication: 
      • Ease of Doing Business   
      • World Development Report 
      • Global Economic Prospects  

    Source: ET