Indian diaspora remittances reach record high media
The Indian diaspora sent a record $135.46 billion in remittances to the country in the 2024-25 fiscal year, the Economic Times newspaper reported, citing central bank data.
Marking a 14% rise from the previous year, remittances, reflected as 'private transfers', accounted for over a tenth of gross current account inflows of $1 trillion, according to the report.
"India's remittance receipts have generally remained higher than India's gross inward foreign direct investment flows, thus establishing their importance as a stable source of external financing," the newspaper cited a report by the staff of the Reserve Bank of India as saying.
In the 2024-25 fiscal year, the largest source of remittances to the South Asian nation was the US, which accounted for 27.7% of the total, according to the Indian Express newspaper. Other major sources included the UAE (19.2%), UK (10.8%), and Saudi Arabia (6.7%).
India was the top recipient country for remittances in the 2024 calendar year,according to the World Bank. The bank estimated the total value of remittances sent to the country at $129 billion.
The South Asian nation was followed by Mexico ($68 billion), China ($48 billion), the Philippines ($40 billion), and Pakistan ($33 billion).
"The strong growth in remittances has persisted despite a weakness in crude oil prices," Gaura Sengupta, chief economist at IDFC First Bank told the Economic Times. "This is a result of a rising share of the skilled labor force migrating to developed markets such as the US, UK and Singapore."
However, potential economic slowdowns in advanced economies as well as new policies in countries such as the US could pose a threat to remittances to the South Asian nation and other countries throughout the Global South.
On Tuesday, the US Senate passed President Donald Trump's "One Big Beautiful Bill Act," which introduces a new tax on overseas money transfers by non-citizens. Under this legislation, all remittances made through cash, money orders, or cashier's cheques face a 1% remittance tax.
(RT.com)
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