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India to receive over record $100bn in Remittances in 2022: World Bank Brief

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India to receive over record $100 bn in remittances in 2022The World Bank in its 37th Migration and Development Brief 2022 titled ‘Remittances Brave Global Headwinds , Special Focus: Climate Migration’ stated that India is all set to receive more than USD 100 billion (bn) in yearly remittances in 2022.

  • This means migrant workers from India will send a record USD 100 bn in 2022 to their home country (India), despite global headwinds like rising prices.
  • This is for the first time a single country will receive more than USD 100 bn in yearly remittances.

Highlights from the Brief:

i.India remains the world’s top recipient of remittances.

ii.The growth of global remittance flows is expected to be 4.9% in 2022.

iii.Remittance flows to India will rise 12% which is ahead of China, Mexico and the Philippines.

iv.Remittances to South Asia grew an estimated 3.5% to USD 163 billion in 2022.

  • However, there is a large disparity across countries. For India, it is projected to rise at 12% but for Nepal it is 4% increase.
  • For the region’s remaining countries, there is an aggregate decline of 10%.

v.Remittance flows to Europe and Central Asia are estimated to have increased by 10.3% to $72 billion in 2022.

vi.Growth in remittance flows is estimated at 9.3% for Latin America and the Caribbean, 2.5% in the Middle East and North Africa, and 0.7% in East Asia and the Pacific.

vii.Remittances to low- and middle-income countries (LMICs) are increased by an estimated 5% to USD 626 billion which is lower than the 10.2% increase in 2021.

viii.The World Bank’s Groundswell report estimated that internal climate migration may reach up to 216 million people by 2050 due to slow-onset climate impacts.

Reason behind the enhanced Remittances to India

i.Remittances to India were enhanced by wage hikes and a strong labour market in the United States (US) and other Organisation for Economic Co-operation and Development (OECD) countries

ii.In the Gulf Cooperation Council destination countries, governments ensured low inflation through direct support measures which resulted in migrants’ ability to remit.

Remittance Costs:

i.According to the World Bank’s Remittance Prices Worldwide Database, the global average cost of sending $200 to LMICs was 6% in the Q2 of 2022.

ii.Among developing country regions, the cost was lowest in South Asia, at about 4.1%, while Sub Saharan Africa continued to have the highest average cost, about 7.8%.

iii.The cost is cheapest to send via mobile operators (3.5%), but digital channels account for less than 1% of total transaction volume due to the burden of compliance with Anti-Money Laundering/Combating the Financing of Terrorism regulations.

The Migration and Development Brief analyzes trends in migration-related SDG (Sustainable Development Goal) indicators: increasing the volume of remittances as a percentage of GDP, reducing remittance costs, and reducing recruitment costs.

Click Here for full report

Recent Related News:

i.In September 2022, the World Bank’s (WBs) Board of Executive Directors approved a loan of USD 150 million (nearly Rs 1,200 crores) to Punjab for the management of its financial resources and improved access to public services.

ii.According to the World Bank East Asia And The Pacific Economic Update October 2022: Reforms for Recovery, Growth in developing East Asia and the Pacific (as whole) is projected to slow to 3.2% in 2022 from 7.2% in 2021, before accelerating to 4.6% in 2023.

About World Bank (WB):

President – David Malpass
Headquarters – Washington D.C, United States (US)
Members – 189 member countries
Establishment– 1944