India received $87 billion in remittances in 2021

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The World Bank in its latest report on Wednesday, November 18, 2021, said that India received $87 billion in remittances in 2021, and the United States was the largest source, accounting for over 20 per cent of these funds.

“Flows to India expected to reach $87 billion, a gain of 4.6 per cent” with the severity of COVID-19 caseloads and deaths during Q2 playing a prominent role in drawing altruistic flows to the country,” the World Bank report stated.

India had received over $83 billion in remittances in 2020.

What is Remittance?

A remittance is a payment of money that is transferred to another person or party. Such transactions are often performed internationally and can be completed almost instantly. Many people use remittances as a means of sending money back to their home country to provide financial aid. Remittances are also used to aid developing countries and form a part of GDP.

Countries with highest remittance

The World Bank report stated that India is the world’s largest remittance recipient, followed by China, Mexico, the Philippines and Egypt. In India, remittances are projected to increase by 3 per cent to $89.6 billion in 2022, reflecting a fall in the total migrant stock, as a large proportion of returnees from Arab countries await the return, it said.

Remittances to low & middle-income countries projected to grow by 7.3%

The World Bank said remittances to low and middle-income countries are projected to grow by 7.3 per cent to reach $589 billion in 2021.

This return to growth is stronger than earlier estimates and follows a resiliency of flows into 2020, when remittances declined by 1.7 per cent despite a severe global slowdown due to COVID-19, according to projections from the World Bank’s Migration and Development Brief.

“Remittance flows from migrants have greatly complemented government cash transfer programs to support families grappling with economic hardships during the COVID-19 crisis. Facilitating the flow of remittances to provide relief to a strained household budget should be a key component of government policies to support global recovery from the pandemic,” said Michal Rutkowski, World Bank’s global director for social protection and jobs.