In 2016, India could see the biggest drop in remittances—money sent back home by its nationals working abroad—over the last decade.

Although India will still remain the world’s biggest recipient of such funds, the World Bank estimates there could be a 5% fall in the quantum of money sent back home. In 2015, Asia’s third-largest economy received $69 billion (Rs4.6 lakh crore) in remittances from Indians employed overseas, broadly referred to as NRIs or non-resident Indians.

A slowdown in this fund-flow has serious ramifications. For one, it is a key source of foreign exchange in India, contributing nearly 4% to the country’s GDP. For some states, remittances are critical. In Kerala, for instance, they form 36% of the net domestic product of the state. In fact, Kerala’s finance minister recently cautioned that the state might face a recession owing to this fall.

Over the past decade, remittances to India have dropped only twice: in 2009 (by 1.4%) and in 2015 (1.8%).

Why the slump

The main reason for this slowdown is low oil prices, which have taken a toll on the six-nation Gulf Cooperation Council (GCC). This region is a major source funds for India and other South Asian countries. Over the years, millions of Indians have migrated to the Middle East for employment. Between 2008 and 2012 alone, over 3.5 million went to just one country, Saudi Arabia, looking for work.

“Remittances from the GCC countries continued to decline due to lower oil prices and labour market ‘nationalisation’ policies in Saudi Arabia,” Dilip Ratha, a lead economist at the World Bank, wrote in the report. Nationalisation, which refers to government policies that leave migrant labourers mostly out of demand, is a much bigger threat than oil prices, according to Ratha.

Overall, remittances to South Asia would decline by 2.3% in 2016, the World Bank estimated.

Meanwhile, other factors like the high cost of transferring funds (around 6% of the transaction amount on an average) are also increasingly forcing workers to use informal channels. When sent via these channels, the funds don’t get included in official records or national accounting.

In an interview with Quartz last December, World Bank’s Ratha had explained that such funds could be “larger than (India’s) revenue from IT exports.” “It is more than twice or even three times the size of foreign direct investment coming to India,” Ratha had said.

To fix the problem, the Indian government is currently working on reducing the high cost of remittance. But it better hurry up.