In 2024, India topped global remittance inflows, receiving an estimated $129 billion, followed by Mexico, China, the Philippines, and Pakistan, according to a blog post by World Bank economists. This surge is attributed to the recovery in job markets across high-income countries, particularly within the Organization for Economic Co-operation and Development (OECD) nations.
Remittances are projected to grow by 5.8% in 2024, a significant improvement from the 1.2% growth recorded in 2023. Remittances to low- and middle-income countries (LMICs) are projected to reach $685 billion this year. The report highlighted that remittances continue to outpace other financial flows to LMICs, a trend driven by increasing migration due to demographic pressures, income disparities, and climate change.
The World Bank noted that remittance flows to South Asia are likely to experience the most substantial growth, with an increase of 11.8%. This growth is led by sustained remittances to India, Pakistan, and Bangladesh.
Furthermore, the gap between remittance inflows and Foreign Direct Investment (FDI) is widening. Over the past decade, remittances have grown by 57%, whereas FDI has dropped by 41%. The report emphasized the need for countries to recognize the importance and resilience of remittance flows. Policymakers are encouraged to leverage these funds to reduce poverty, improve healthcare and education, boost household financial inclusion, and enhance access to capital markets for both public and private enterprises.
