India: Top Remittance Recipient

• 21 Jul 2022

For Prelims: Remittance Receipt, Economic Survey, India’s position at global remittance receipt level, WHO, World Report on the health of refugees and migrants

For Mains: Importance of remittances, Negative effects of Migration

Why in News?

According to a report released recently by the World Health Organisation titled ‘’World report on the health of refugees and migrants’’, India received USD 87 billion in remittances in 2021.

What do we know about the Report?

• About:
  • The report is the first to offer a global review of health and migration and calls for urgent and concerted action to support refugees and migrants across the world to access health care services that are sensitive to their needs.
• Findings:
  • Migration:
    • It states that ‘Globally, about one in eight people are migrants.” (Total 1 billion are Migrants)
    • From 1990 to 2020:
      • The total number of international migrants increased from 153 million to 281 million.
        • About 48% of international migrants are women and some 36 million are children.
    • As of 2020, Europe and North America hosted the greatest number of international migrants, followed by northern Africa and western Asia.
    • More than half of newly recognized refugees during the first half of 2021 were from five countries:
      • Central African Republic
      • South Sudan
      • Syrian Arab Republic
      • Afghanistan
      • Nigeria
  • Remittance:
    • In 2021 the top five remittance recipients (among low- and middle-income countries) in current US dollars were:
      • India: 83 billion
        • India’s remittances rose by 4.8% in 2021. (Remittance in 2020 at USD 83 billion)
      • China: 53 billion
      • Mexico: 53 billion
      • Philippines: 36 billion
      • Egypt: 33 billion
    • As a share of Gross Domestic Product (GDP), the top five remittance recipients in 2021 were smaller economies:
      • Tonga: 44%
      • Lebanon: 35%
      • Kyrgyzstan: 30%
      • Tajikistan: 28%
      • Honduras: 27%
    • In most other areas, remittances have also recovered strongly, registering growth of 5–10% in Europe and Central Asia, the Middle East and northern Africa, Southern Asia and sub-Saharan Africa.
    • But at a slower pace of 1.4% in Eastern Asia and the Pacific, excluding China.

What do we know about the Remittances?

• A remittance is money sent to another party, usually one in another country.
• The sender is typically an immigrant and the recipient a relative back home.
• Remittances represent one of the largest sources of income for people in low-income and developing nations.
  • It often exceeds the amount of direct investment and official development assistance.
• Remittances help families afford food, healthcare, and basic needs.
• India is the world’s biggest recipient of remittances.
  • Remittances bolsters India's foreign exchange reserves and helps fund its current account deficit.

What is the Significance of Remittances?

• Remittances increase or maintain consumer spending and soften the blow of economic hardship, such as during the Covid-19 pandemic.
• Remittances account for a large fraction of the global movement of funds.
  • Despite predictions that remittances would fall due to the Covid-19 pandemic (in part as a result of travel restrictions and the economic downturn), remittances proved to be resilient.
• Remittances are an "important and positive" economic result of migration for migrants themselves and for family and friends remaining in their home countries.
• Remittances now stand at more than threefold above official development assistance and are more than 50% higher than foreign direct investment, excluding in China.

What are Negative Effects of Migration?

• Brain Drain:
  • The movement of skilled labour may result in a so-called brain drain, typically, from lower-income countries, and a brain gain in higher-income countries in a process known more generically as brain circulation.
    • Brain drain may worsen the availability of services, such as health care, if highly skilled doctors and nurses leave lower income countries seeking better economic opportunity.
• Left-behind Families:
  • Migration affects not only people who move but also their family and community members who remain:
    • An estimated 193 million family members of migrant workers are left behind.
  • Migration of individuals to high income countries to undertake care jobs for the host population can create a care deficit for their own families, especially for children and older people.
• Discrimination & Xenophobia:
  • Refugees and migrants may face hateful treatment or attitudes.
    • Xenophobia is the treatment of people as outsiders because of their language, culture, appearance or place of birth.
    • Xenophobia may expose refugees and migrants in host countries to discrimination, mistreatment or violence, and it has serious public health consequences.
• People Smuggling & Human Trafficking:
  • While much migration occurs without contravening laws or regulations, a significant yet unmeasurable portion of migrants is exploited by criminal networks.
    • Although different in legal terms, people smuggling and human trafficking share many similarities in how they are carried out, and are sometimes hard to distinguish from each other.

Source: ET