New Delhi: India was the biggest recipient of remittances globally in 2015, with the southern state of Kerala accounting for the highest share, a study showed.

India received $69 billion in remittances, followed by China at $64 billion, according to the report ‘Remittances and its impact on financial inclusion and development in India’, commissioned by Western Union, an American financial services and communications company.

Kerala received 25-30% of the remittances to India, followed by Andhra Pradesh, Tamil Nadu and Punjab.

Kerala and Tamil Nadu used most of the remittances not just for subsistence and debt repayments but also for productive reasons such as education, healthcare expenses and bank savings, the report said.

The report prepared by Edelman India, the research and analytics department of Edelman, a communications firm, was presented by Hikmet Ersek, chief executive and director of Western Union, to finance minister Arun Jaitley on 5 September.

An inward remittance is money sent by migrants to their homes. The paper highlighted the positive impact of inward remittances on financial inclusion, poverty and social factors such as health and education.

The Gulf countries are among the top eight remittance sources for India in 2015.

Five Gulf Cooperation Council (GCC) countries—the UAE, Qatar, Saudi Arabia, Kuwait and Oman—contributed 50% of the total value of remittances in 2015, despite their economies suffering from a decline in oil prices.

“Remittances in the 80s were mainly driven by the economic prosperity in the oil exporting countries. The policies of liberalization during the 90s led to a lot of Indian information technology professionals migrating to the US for better opportunities, thus leading to an increase in remittances. Since the 1990s, migration to other countries like Canada and Australia has also increased but the number is still less compared to the Gulf countries," the report said.

According to the report, a study was conducted where 52 respondents (among the remittance receivers) across states like Kerala, Tamil Nadu, Andhra Pradesh, Uttar Pradesh, Punjab and Delhi were interviewed.

It was found that 90% of the respondents have bank accounts and mostly use them for receiving remittances. In addition, 51.9% and 63% of them cited medical expenses and education, respectively, as their priority expenditure.

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