India Expects to Receive $100 Billion in Remittances in 2022

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Supportive Measures: In the Gulf Cooperation Council (GCC) countries, governments ensured low inflation through direct support measures that protected migrants’ ability to remit.

Depreciation: Depreciation of the Indian rupee to the US dollar has also proven advantageous for Indian migrants and increased remittance flows.

Impact of Rise in Remittance

Income: Remittances are a vital source of household income for low- and middle-income countries.

• Gross Domestic Product (GDP): Despite reaching a historic milestone of $100 billion, India’s remittance flows are expected to account for only 3% of its GDP in 2022.

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Performance of Other Nations

• The overall global remittance has faced a slowdown due to the impact of an amalgam of external global shocks (inflation, slowing demand) in destination and source countries alike, as well as domestic factors.
• The remittances to low- and middle-income countries will grow by 5% to $626 billion, despite global challenges in 2022, as per the World bank’s report.
• The World Bank has predicted that remittance flows to South Asia this year will grow 3.5% to reach $163 billion in 2022.
• Nepal has seen a rise of 4% in remittance, which is also considered a strong rise along with India.

Further Predictions’ in World Banks’ Report

• The growth of remittance flows into South Asia in 2023 is expected to slow to 0.7%. 
• The year (2023) will stand as a test for the resilience of remittances from white-collar South Asian migrants in high-income countries.
• Remittance flows in India, specifically, are predicted to decrease due to inflation and an economic slowdown in the United States. 
• The decline in economic growth in the GCC coupled with a fall in oil prices will further pull remittance flows down to all South Asian countries.

News Source: The Indian Express

https://indianexpress.com/article/explained/explained-economics/india-remittance-record-100-billion-world-bank-8301992/

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