In 2018, Indian Overseas Immigrants would send a whopping $80 billion back home. It will make India the top recipient of remittances in 2018. The amount has surpassed those to China, Philippines and Mexico.
As reported by INDIA TODAY, China is expected to receive around $67 billion. The remittance to India is equivalent to 2.8 percent of India’s GDP. Also, it is nearly 12 percent of total remittances across the world.
A constant flow of remittance is essential to under-developed countries. It helps improve their economy. Michal Rutkowski, Senior Director of the World Bank said that the bank ensures a smooth and constant flow of remittances.
A report by the bank indicates that the total remittances would increase by 10.8 percent in this year. In 2017, the growth was nearly 7.9 percent. However, the steady growth might not last long. This year the growth was driven by stronger economic conditions in countries like the USA. Also, high oil price had a positive impact on it.
Lower oil price would mean low remittance. Moreover, many countries are in the process of curbing Overseas Immigration. These downturns are bound to lower the rate of remittance in 2019. Next year the yearly remittance sent by Overseas Immigrants would grow by 3.7 percent.
Indian Overseas Immigrants had to pay a huge cost to remit such a big amount. Under the Sustainable Development Goal, the remittance rate is to be reduced by 3 percent in the coming years. Advance technology has failed to reduce the Remittance cost. The fees still remain quite high, almost double the target. It is putting an unnecessary burden on Overseas Immigrants.
The World Bank suggests that opening markets to competition might help. Also, the countries should promote the use of low-cost technologies. This would lower the burden. In addition, the recruitment costs in employing countries should be reduced.
Overseas Immigrants usually pay a huge cost for employment. Low-skilled Immigrants fall victim to such arrangements. The cost might amount to 2 years salary of Overseas Immigrants. Recruitment procedures should be improved by reducing any such cost. This would ensure lower pressure on Overseas Immigrants.
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