India received close to $90 billion in remittance flows from around the world in 2022, with the UAE being the second-largest source of remittances to the South Asian country.
The total remittance flows during the 2021-22 fiscal year were the highest received by India in a single year, data from India’s Ministry of Finance showed. India’s fiscal year starts on April 1 and ends on March 31.
The US, the world’s largest economy, was the biggest source of remittances to India, with a 23.4 per cent share in total remittance flows, followed by the UAE at 18 per cent. The UK was in third place with a 6.8 per cent share and Singapore was fourth with a 5.7 per cent share.
Saudi Arabia, the Arab world’s largest economy, was the sixth biggest source of remittances to India with a total share of 5.1 per cent in total remittances, while Kuwait, Oman and Qatar had a share of 2.4 per cent, 1.6 per cent and 1.5 per cent, respectively.
The UAE and other Gulf countries are major sources of remittance flows to India. Thousands of Indians living in the six-member Gulf Co-operation Council bloc send money to family back home, supporting the growth of Asia's third-largest economy.
Last week, the UAE and India signed agreements for establishing a framework to promote the use of local currencies for cross-border transactions and co-operation for interlinking payment and messaging systems during the visit of Indian Prime Minister Narendra Modi to the UAE.
The agreements, which promote the use of the Indian rupee and the dirham bilaterally, are expected to boost investments and remittances between the two countries, the Reserve Bank of India said on its website.
The two countries also agreed to co-operate on linking their fast payment systems – India’s Unified Payments Interface with the UAE’s Instant Payment Platform – to ease cross-border money transfers.
Last year, India and the UAE also signed a comprehensive economic partnership agreement, boosting economic ties between the two countries.