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India Remittances Projected at Record Low: World Bank Group
In India remittances are projected to fall by about 23 percent in 2020, to $64 billion – a striking contrast with the growth of 5.5 percent and receipts of $83 billion seen in 2019
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The World Bank Group has made projection that global remittances are set to nosedive by around 20 percent this year due to the COVID-19-induced economic crisis. Remittances to low and middle-income countries are projected to tank by 19.7 per cent to $445 billion, representing a loss of a crucial financing lifeline for many vulnerable households, according to the statement.
Total remittances are expected to fall to $445 billion this year from $554 billion in 2019, the report said.
In India remittances are projected to fall by about 23 percent in 2020, to $64 billion – a striking contrast with the growth of 5.5 percent and receipts of $83 billion seen in 2019. In Pakistan, the projected decline is also about 23 percent, totaling about $17 billion, compared with a total of $22.5 billion in 2019, when remittances grew by 6.2 percent. In Bangladesh, remittances are projected at $14 billion for 2020, a likely fall of about 22 percent.
The report also comments on the Indian lock-down situation. "The magnitude of internal migration is about two-and-a-half times that of international migration," it says. "Lock-downs, loss of employment, and social distancing prompted a chaotic and painful process of mass return for internal migrants in India and many countries in Latin America," it adds.
The lock-down in India has impacted the livelihoods of a large proportion of the country’s nearly 40 million internal migrants, the report adds. "Around 50,000–60,000 moved from urban centers to rural areas of origin in the span of a few days," it said.
The report also acknowledges that some governments are "already providing some assistance to these vulnerable groups who are at risk of spreading the virus. For instance, in India, the government has now set up camps with basic
provisions to provide shelter to stranded migrants in cities and districts of destination, transit, and origin," it adds.
Low-Skilled Migrants - India & Pakistan Situation
The report mentions that primarily low-skilled emigrants from India and Pakistan increased in 2019 relative to the prior year but is expected to decline in 2020 due to the pandemic and oil price declines impacting the GCC countries.
In India, the number of low-skilled emigrants seeking mandatory clearance for emigration rose slightly by 8 per cent to 368,048 in 2019 (Ministry of External Affairs, India). In Pakistan, the number of emigrants jumped 63 percent to 625,203 in 2019 (Bureau of Emigration & Overseas Employment, Pakistan), largely due to a doubling of emigration to Saudi Arabia.
Commenting on the report, World Bank Group President David Malpass said: "Remittances are a vital source of income for developing countries...noting that remittances help families afford food, healthcare, and basic needs."
Remittance flows are expected to fall across all World Bank Group regions, most notably in Europe and Central Asia (27.5 per cent), followed by Sub-Saharan Africa (23.1 per cent), South Asia (22.1 per cent), the Middle East and North Africa (19.6 percent), Latin America and the Caribbean (19.3 per cent), and East Asia and the Pacific (13 per cent).
“Quick actions that make it easier to send and receive remittances can provide much-needed support to the lives of migrants and their families. These include treating remittance services as essential and making them more accessible to migrants,” said Dilip Ratha, lead author of the Brief and head of KNOMAD.