India world’s largest recipient of remittances: World Bank

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.

Source: ET