A 2010 Study pointed out that The Human Development Report of 2009 estimated that about 214
million people, or roughly 3.1 percent of the world’s population, lived and worked outside
the country of their birth in 2008, up from 120 million in 1990. Given the difficulties in
the definition of a migrant across countries, this may be an underestimation of the real
stock of migrants in the world.
The migrants from developing countries to other developing countries constituted 47 per cent of total migrants from developing countries in 2005. Migration therefore may no longer be considered as a “South-North” phenomenon, as often assumed. Many countries in South-east Asia, for instance, are heavily reliant on cheap migrant labour from neighbouring countries. In contrast, the majority of migrants from high-income Organization for Economic Cooperation and Development (OECD) countries go to other high-income OECD countries (85 per cent).
Remittances have become significant private financial resources for households in countries of origin of migration although they cannot be considered as a substitute for foreign direct investment (FDI), official development assistance, debt relief or other public sources of finance development. There has been a 15-fold increase in remittances to developing countries since 1988 with remittances increasing from $20 billion to $328 billion in 2007. A study from 2000-2010 found that remittance flows have become as large as foreign direct investment flows to developing countries. The World Bank estimates that remittances through informal channels could add at least 50 percent to the globally recorded flows.
While remittances cannot be considered as a substitute for FDI and other official development assistance, it may ease short-run foreign exchange constraints at times other financial flows decline due to external factors. Two factors – namely, time spent working abroad and total amount of money saved abroad – have positive and significant effect on the likelihood of migrants becoming entrepreneurs on their return to the home country. The households receiving international remittances spend more on investment goods, especially on housing and education.
A World Bank study in 2005 showed that a 10 per cent increase in per capita official international remittances will lead, on average to a 3.5 per cent decline in the share of people living in poverty. A study found that in 2000, remittances helped reduce the national poverty rate by 4.2 per cent in El Salvador. A study in Lesotho showed that if the remittances were set to zero, the poverty head count index would increase by 26 per cent. Another study found that remittances have stronger impact on poverty reduction if they are above the threshold of 5 per cent of GDP of the country.
The pace of migration from India accelerated in the post-economic reforms of 1991. The Ministry of Overseas Indian Affairs has registered the presence of non-resident Indians in 180 of the 183 countries of the world. The numbers have varied from just two in Lebanon to almost a million in the United States. Estimated at over 30 million, India ranks second to Chinese Diaspora. There has been an annual average growth trend of 16 per cent in remittances during the period 1990–2008. The surging inflow of remittances to the Indian economy has received much attention worldwide as it emerged as single largest recipient with more than one tenth share in global remittances. Remittances grew steadily as a percentage of GDP – from less than 1 per cent in 1990 to 3 per cent in 2000 and 6 per cent in 2008.
The 2010 study showed that the official data on the state-wise emigration clearance pointed to Kerala is the state with highest immigration clearance in India in 2008. The share of Uttar Pradesh had increased drastically in recent years, and has become second only to Kerala during 2008 and up to March 2009. On the other hand, the share of major states such as Tamil Nadu, Andhra Pradesh and Maharashtra in the total immigration clearance had experienced a declining trend in recent years.
Around 20 per cent of total officially recorded remittances in India are received by Kerala. Although the average per capita consumption in Kerala was below the national average until 1978–79, by 1999–2000 consumer expenditure in Kerala exceeded the national average by around 41 per cent.
Acknowledgement : This post has been excerpted from a UN Report of 2010, 'Impact of Remittances on Poverty in Developing Countries'.
The migrants from developing countries to other developing countries constituted 47 per cent of total migrants from developing countries in 2005. Migration therefore may no longer be considered as a “South-North” phenomenon, as often assumed. Many countries in South-east Asia, for instance, are heavily reliant on cheap migrant labour from neighbouring countries. In contrast, the majority of migrants from high-income Organization for Economic Cooperation and Development (OECD) countries go to other high-income OECD countries (85 per cent).
Remittances have become significant private financial resources for households in countries of origin of migration although they cannot be considered as a substitute for foreign direct investment (FDI), official development assistance, debt relief or other public sources of finance development. There has been a 15-fold increase in remittances to developing countries since 1988 with remittances increasing from $20 billion to $328 billion in 2007. A study from 2000-2010 found that remittance flows have become as large as foreign direct investment flows to developing countries. The World Bank estimates that remittances through informal channels could add at least 50 percent to the globally recorded flows.
While remittances cannot be considered as a substitute for FDI and other official development assistance, it may ease short-run foreign exchange constraints at times other financial flows decline due to external factors. Two factors – namely, time spent working abroad and total amount of money saved abroad – have positive and significant effect on the likelihood of migrants becoming entrepreneurs on their return to the home country. The households receiving international remittances spend more on investment goods, especially on housing and education.
A World Bank study in 2005 showed that a 10 per cent increase in per capita official international remittances will lead, on average to a 3.5 per cent decline in the share of people living in poverty. A study found that in 2000, remittances helped reduce the national poverty rate by 4.2 per cent in El Salvador. A study in Lesotho showed that if the remittances were set to zero, the poverty head count index would increase by 26 per cent. Another study found that remittances have stronger impact on poverty reduction if they are above the threshold of 5 per cent of GDP of the country.
The pace of migration from India accelerated in the post-economic reforms of 1991. The Ministry of Overseas Indian Affairs has registered the presence of non-resident Indians in 180 of the 183 countries of the world. The numbers have varied from just two in Lebanon to almost a million in the United States. Estimated at over 30 million, India ranks second to Chinese Diaspora. There has been an annual average growth trend of 16 per cent in remittances during the period 1990–2008. The surging inflow of remittances to the Indian economy has received much attention worldwide as it emerged as single largest recipient with more than one tenth share in global remittances. Remittances grew steadily as a percentage of GDP – from less than 1 per cent in 1990 to 3 per cent in 2000 and 6 per cent in 2008.
The 2010 study showed that the official data on the state-wise emigration clearance pointed to Kerala is the state with highest immigration clearance in India in 2008. The share of Uttar Pradesh had increased drastically in recent years, and has become second only to Kerala during 2008 and up to March 2009. On the other hand, the share of major states such as Tamil Nadu, Andhra Pradesh and Maharashtra in the total immigration clearance had experienced a declining trend in recent years.
Around 20 per cent of total officially recorded remittances in India are received by Kerala. Although the average per capita consumption in Kerala was below the national average until 1978–79, by 1999–2000 consumer expenditure in Kerala exceeded the national average by around 41 per cent.
Acknowledgement : This post has been excerpted from a UN Report of 2010, 'Impact of Remittances on Poverty in Developing Countries'.
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