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Inward Remittances: Kerala, Maharashtra and Karnataka receive the maximum; MP is a lower rung State

Lalit Shastri

Kerala, Maharashtra, Karnataka and Tamil Nadu together received 58.7 per cent of total inward remittances in 2016-17.

The central Indian State of Madhya Pradesh, being ruled continuously by the BJP for last 15 years, is ranked 15th in terms State-wise share in Inward Remittances during 2016-17.

Madhya Pradesh Chief Minister Shivraj Singh Chouhan takes credit and keeps shouting from rooftops that MP has witnessed tremendous progress and has shed the BIMARU tag – the word BIMARU means sick in Hindi and represents a cluster of States including Bihar, Madhya Pradesh, Rajasthan and Uttar Pradesh – the four Hindi speaking states that are considered the most backward states in the country.

When it comes to State-wise share in Inward Remittances, Madhya Pradesh’s share at 0.4 per cent is even less than Bihar (1.3 per cent), Uttar Pradesh (3.1 per cent) and Rajastan (1.2 per cent).

In sharp contrast, the share of Kerala is at the top of the chart with a share of 19.0 per cent, Maharashtra is second with a share of 16.7 per cent, followed by Karnataka with 15 per cent share in total remittances.

 State-wise Share in Inward Remittances
Per cent
Destination State Share in total remittances
Kerala 19.0
Maharashtra 16.7
Karnataka 15.0
Tamil Nadu 8.0
Delhi 5.9
Andhra Pradesh 4.0
Uttar Pradesh 3.1
West Bengal 2.7
Gujarat 2.1
Punjab 1.7
Bihar 1.3
Rajasthan 1.2
Goa 0.8
Haryana 0.8
Madhya Pradesh 0.4
Orissa 0.4
Jharkhand 0.3
Uttaranchal 0.2
Puducherry 0.2
Chandigarh 0.2
Jammu and Kashmir 0.2
Assam 0.1
Himachal Pradesh 0.1
Chhattisgarh 0.1
Others 15.5
Total 100.0
Note: “Others” also includes those remittances for which banks could not identify the specific destination and therefore covered such transactions under “Others”.

The Reserve Bank today released the results of its survey on India’s inward remittances in 2016-17, the fourth in the series. The third round of the survey was published in December 2013.

Eighty-two per cent of the total remittances received by India originated from eight countries, viz., the United Arab Emirates, the United States, Saudi Arabia, Qatar, Kuwait, Oman, the United Kingdom and Malaysia.

Remittances to India were mostly routed through private sector banks (74.2 per cent), followed by public sector banks (17.3 per cent) and foreign banks (8.5 per cent)

More than half of remittances received by Indian residents were used for family maintenance, i.e., consumption (59.2 per cent), followed by deposits in banks (20 per cent) and investments in landed property and shares (8.3 per cent).

Earlier in April this year, the World Bank released its Migration and Development Brief announcing that remittances to low-and middle-income countries rebounded to a record level in 2017 after two consecutive years of decline.

According to the World Bank, remittance inflows improved in all regions and the top remittance recipients were India with $69 billion, followed by China ($64 billion), the Philippines ($33 billion), Mexico ($31 billion), Nigeria ($22 billion), and Egypt ($20 billion).

The latest figures on inward remittances and transfers made by the NRIs, especially the percentage share vis-a-vis the destination States is an indicator of the degree of human development, which obviously differs from State to State. What is a matter of serious concern is that the lower rung States also have highly unequal levels of development and poor human development index that presents a picture of poverty, grossly unequal levels between the rich and the poor, lopsided equity distribution for the purpose of building the economic infrastructure, which is so essential for improving the quality of life of the people across the board.

Our inward remittances are the highest in the world and this speaks volumes of the Indian workforce, professionals, and scientists, including the highly skilled IT personnel working overseas. The States commanding a good share in remittances have reason to rejoice but it is time for leaders at the helm in States struggling at the bottom to look inward and do some self-introspection.

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