US Overtakes UAE as India’s Largest Source of Remittances, Says RBI Survey

The Reserve Bank of India (RBI) released the results of the sixth round of India’s Remittances Survey (2023-24), revealing a shift in migration trends. More skilled professionals are migrating, leading to an increase in remittances from advanced economies, surpassing inflows from Gulf nations.

Introduction to India’s Changing Remittance Trends

The latest RBI survey highlights a significant transformation in India’s remittance landscape. Traditionally, a substantial portion of remittances came from the Gulf Cooperation Council (GCC) nations, where Indian workers, mainly engaged in blue-collar jobs, contributed to the inflows. However, the recent survey reveals that remittances from advanced economies such as the United States, the United Kingdom, Canada, and Australia have now surpassed those from Gulf nations.

Key Findings of the RBI Remittances Survey (2023-24)

1. Leading Source Countries for Remittances

• The United States (US) emerged as the top source of remittances, contributing 27.7% of total inflows to India in 2023-24.
• The United Arab Emirates (UAE), previously the top contributor, now holds the second position with a 19.2% share.
• Other major contributors include the UK, Singapore, Canada, and Australia, collectively accounting for more than 50% of total remittances.
• The GCC nations (UAE, Saudi Arabia, Kuwait, Qatar, Oman, and Bahrain) now hold a 37.9% share of remittances, down from 46.7% in 2016-17.

2. Shift in Migration Patterns: Blue-Collar vs. White-Collar Jobs

• UAE remains the largest hub for Indian migrant workers, particularly in construction, healthcare, hospitality, and tourism sectors.
• The US attracts highly skilled Indian professionals, with 78% employed in high-earning occupations such as management, business, science, and the arts.
• This explains why remittances from the US are higher than from the UAE, despite a smaller Indian migrant population.

3. State-Wise Remittance Distribution

• Maharashtra has overtaken Kerala as the top recipient of remittances, with 20.5% of the total share in 2023-24.
• Kerala, which held the top position in 2016-17 (19% share), is now in second place.
• Tamil Nadu has also increased its share from 8% (2016-17) to 10.4% (2023-24).

4. India’s Global Share in Remittances

• According to World Bank data, India’s share in global remittances has risen from 11% in 2001 to 14% in 2024.
• Remittance inflows are projected to increase to around $160 billion by 2029.
• Other major recipients of remittances include Mexico, China, the Philippines, France, Pakistan, and Bangladesh.

5. Role of Digitalization in Remittance Transfers

• The cost of sending remittances to India has declined, thanks to advancements in digital payment methods.
• 73.5% of total remittances received in India in 2023-24 were through digital channels, including fintech platforms and money transfer operators.

Significance of the Findings

The findings underscore a paradigm shift in India’s migration and remittance patterns:

• Skilled migration is increasing, leading to higher-value remittances from advanced economies.
• The role of GCC nations in India’s remittance economy is declining, reflecting the shift in workforce skills.
• Digital transactions are revolutionizing remittance transfers, reducing costs and increasing efficiency.

Summary of RBI Remittances Survey (2023-24)