Indian diaspora sends home $135 billion, the highest remittances on record

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India has remained the world's top recipient of remittances for over a decade, with inflows more than doubling since 2016-17, when they totalled $61 billion read more
US Dollar banknotes are seen in this illustration taken July 17, 2022. Representational Image/Reuters
India received $135.46 billion in remittances from its global diaspora in the fiscal year ending March 31, the highest on record, according to new data from the Reserve Bank of India.
The amount marked a 14 per cent increase from the previous year, with remittances continuing to be a major driver of the country's current account flows. The RBI said the inflows, classified under 'private transfers,' accounted for more than 10 per cent of India's gross current account flows of $1 trillion in FY25.
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India has remained the world's top recipient of remittances for over a decade, with inflows more than doubling since 2016-17, when they totalled $61 billion, Economic Times reported.
'The strong growth in remittances has persisted despite weakness in crude oil prices,' said Gaura Sengupta, chief economist at IDFC First Bank. She attributed the increase to a higher share of skilled Indian workers migrating to developed markets, particularly the United States, United Kingdom and Singapore. RBI data show these three countries contributed 45 per cent of total remittances.
The share from Gulf Cooperation Council countries has declined, partly due to lower oil prices, which typically influence remittance flows from the region.
India remains one of the lowest-cost countries for sending $200 in remittances, according to RBI research.
Software services and business services were the other major contributors to current account inflows in FY25, each bringing in over $100 billion. Together with remittances, these three sources accounted for more than 40 per cent of total current account receipts.
A recent RBI staff report noted that remittance inflows consistently exceeded foreign direct investment, underlining their role as a stable source of external financing. In FY25, remittances amounted to 47 per cent of India's merchandise trade deficit of $287 billion.
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India ranked first globally in remittance receipts last year, followed by Mexico with $68 billion and China with $48 billion, according to World Bank estimates.
Remittances represent cross-border household income, typically from migrants sending money home. The International Monetary Fund classifies them under two categories in a country's balance of payments: compensation of employees under primary income, and personal transfers under secondary income.
In India's case, personal transfers, largely comprising money sent by workers abroad for family maintenance and withdrawals from non-resident deposit accounts, make up the bulk of recorded remittances, according to an RBI paper published in March.