Quick Overview
In November 2024, outward remittances under the Reserve Bank of India’s (RBI) Liberalised Remittance Scheme (LRS) increased by 3.6% compared to the previous year, reaching $1.95 billion. However, when looking at the broader September-November quarter of financial year 2025, total remittances decreased to $7.1 billion from $7.5 billion in the same period last year.
Outward remittances rose to $1.95 billion in November 2024, up from $1.87 billion in November 2023.
For the September-November quarter, total remittances fell to $7.1 billion compared to $7.5 billion in the same quarter of the previous year.
While international travel remittances decreased, there was a notable increase in remittances for property purchases and investments.
The LRS allows Indian residents to remit up to $250,000 annually for permissible transactions, a significant increase from the original limit of $25,000 introduced in 2004.
Certain categories, such as remittances for maintenance of relatives and gifts, saw substantial increases, while those for education and medical treatment declined.
Detailed Breakdown
Monthly Performance
In November 2024, remittances under the LRS showed a positive trend with a 3.6% increase compared to the same month in the previous year. This uptick can be attributed to a rise in overseas investments, which helped offset a decline in remittances related to international travel.
Quarterly Overview
During the September-November 2024 quarter, Indians sent $7.1 billion abroad, a decrease from $7.5 billion in the same quarter of 2023. This decline indicates a shift in the overall remittance landscape, suggesting that while some areas are growing, others are contracting.
Categories of Remittance
- International Travel: This category, which historically represents over 60% of outward remittances, saw a decrease of 5.6%, dropping to $1.13 billion from $1.18 billion in November 2023.
- Property Purchases: In contrast, remittances for buying property surged nearly 128%, increasing to $23.5 million from $10.3 million year-over-year. This suggests a growing trend among Indians investing in real estate abroad.
- Investments: There was a remarkable 107.7% year-over-year rise in remittances for equity and debt investments, totaling $85.79 million compared to $41.3 million previously.
- Deposits: Remittances for deposits also increased, rising to $40.21 million from $25.19 million in the prior year.
- Maintenance of Relatives and Gifts: Remittances for maintaining close relatives rose by 33.9% to $276.78 million, and gifts increased to $216.5 million from $181.5 million.
- Education and Medical Treatment: On the downside, remittances for overseas education fell by 16.9% to $172.4 million, and those for medical treatment dipped slightly to $7.5 million.
Important Details & Evidence
The LRS was established to facilitate the remittance process for Indian residents, allowing for a range of transactions from personal gifts to investments. The significant rise in remittances for property and investments reflects a shift in priorities among Indian expatriates, possibly influenced by global economic conditions and investment opportunities.
Final Takeaways
The data from the RBI indicates a complex landscape for outward remittances in India. While there is growth in certain areas like property investment and support for relatives, overall remittance levels are down when compared to the previous year. This suggests a need for further analysis to understand the factors driving these changes, especially in the context of international travel and education expenses. The LRS continues to play a crucial role in facilitating these transactions, adapting to the financial needs of Indian residents abroad.
