Why in News?

•  According to the latest edition of the World Bank’s Migration and Development Brief, India has retained its position as the world’s top recipient of remittances with its diaspora sending a whopping $79 billion back home in 2018.

Highlights:

•  Remittances to low- and middle-income countries reached a record high in 2018.
•  Global remittances, which also include flows to high-income countries, reached $689 billion in 2018, up from $633 billion in 2017.
•  The officially recorded annual remittance flows to low- and middle-income countries reached $529 billion in 2018, an increase of 9.6 % over the previous record high of $483 billion in 2017. Growth in remittance inflows ranged from almost 7% in East Asia and the Pacific to 12 %in South Asia.
•  Remittances to South Asia grew 12% to $131 billion in 2018, outpacing the 6% growth in 2017.
•  The overall increase was driven by a stronger economy and employment situation in the  United States and a rebound in outward flows from some Gulf Cooperation Council (GCC) countries and the Russian Federation.
•  In 2019, remittance flows to low- and middle-income countries are expected to reach $550 billion, to become their largest source of external financing.
•  Among countries, the top remittance recipients were India with $79 billion, followed by China ($67 billion), Mexico ($36 billion), the Philippines ($34 billion), and Egypt ($29 billion). Remittances grew by more than 14% in India, where a flooding disaster in Kerala likely boosted the financial help that migrants sent to families. India received $62.7 billion in 2016 and $65.3 billion in 2017 from remittances.

World Bank’s Migration and Development Brief:

•  It is prepared by the Migration and Remittances Unit, Development Economics (DEC)- the premier research and data arm of the World Bank.
•  It aims to provide an update on key developments in the area of migration and remittance flows and related policies over the past six months.
•  It also provides medium-term projections of remittance flows to developing countries. The brief is produced twice a year.

Remittances:

•  Remittances are usually understood as financial or in-kind transfers made by migrants to friends and relatives back in communities of origin.
•  These are basically sum of two main components;
•  Personal Transfers in cash or in kind between resident and non-resident households and
• Compensation of Employees, which refers to the income of workers who work in another country for a limited period of time.
•  Remittances help in stimulating economic development in recipient countries, but this can also make such countries over-reliant on them