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Informist, Thursday, Dec. 19, 2024

MUMBAI – Driven by a recovery in the job market in high-income countries, India, along with other South Asian countries, is expected to see a rise in remittances in 2024, economists at the World Bank said in a blog post. India, the biggest recipient of remittances globally, is forecast to receive $129 billion this year, up from $115 billion in 2023, according to the World Bank.

"The recovery of the job markets in the high-income countries of the Organisation for Economic Co-operation and Development following the onset of the COVID-19 pandemic, has been the key driver of remittances," the World Bank said. "This is especially true for the United States, where the employment of foreign born workers has recovered steadily and is 11% higher than the pre-pandemic level seen in February 2020."

Globally, the growth in remittances in 2024 is estimated to be 5.8%, which is significantly higher than the 1.2% registered in 2023. In 2024, remittance flows to South Asia are expected to increase the most, at 11.8%, driven entirely by continued strong flows to India, Pakistan, and Bangladesh. 

"Officially recorded remittances to low- and middle-income countries are expected to reach $685 billion in 2024. The true size of remittances, including flows through informal channels, is also believed to be even larger," the economists said in the blog post.

India remains the world's largest recipient of remittances, which are expected to rise in the years ahead. According to a report released by the Reserve Bank of India on Jul. 30, remittances to India are likely to increase to around $160 bln in 2029 from $115 bln in 2023, as the country moves towards becoming the world's biggest supplier of labour in the coming decades. In the previous year, inward remittances received by the country accounted for 13.5% of the total remittances in the world. As per RBI's report, the ratio of remittances to GDP in India has gradually increased to 3.2% in 2023 from 2.8% in 2000.

Going forward, remittances are expected to rise globally due to migration pressures, which are driven by demographic trends, income gaps, and climate change, the World Bank said.  End

US$1 = INR 85.0725

Reported by Siddhi Chauhan

Edited by Avishek Dutta

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