Prioritising Global Mobility in Economic Diplomacy

Source-This post on Prioritizing Global Mobility in Economic Diplomacy has been created based on the article “Migration matters” published in “Business Standard” on 13 May 2024.

UPSC Syllabus: GS Paper 2 – International relations– Effect of Policies and Politics of Developed and Developing Countries on India’s interests, Indian Diaspora.

Context– The article stresses the importance of prioritizing global labor mobility in India’s economic diplomacy to safeguard its interests in the backdrop of rising protectionism in some countries. Prioritising Global Mobility in Economic Diplomacy

What is the scale of Indian migration abroad, and which countries host the largest Indian diaspora?

In 2020, approximately 18 million Indians lived outside their country of birth. Countries like the UAE, US, and Saudi Arabia have the largest Indian diaspora.

What does the latest World Migration Report reveal about India’s migration patterns?

1) Migration Corridors– According to the World Migration Report by the International Organization for Migration, the top migration corridors include India to the UAE, the US, and Saudi Arabia, as well as Bangladesh to India.

2)  Gender Skew-The number of people emigrating from India remains the highest in the world, and external migration from India is gender-skewed, with nearly 65% of emigrants being male. This suggests that men migrate for work whereas women stay behind.

Read more- A retelling of the Indian migrant worker’s plight

What are the contribution and concerns regarding remittances in Indian economy?

1) Contribution–

A) Remittances are a major source of income for India. It receives over $111 billion in 2022, making it the top remittance recipient globally.

B) Remittances help narrow India’s current account deficit and boost household consumption and domestic demand.

2) Concerns–

A) It can cultivate a culture of dependency, potentially lowering productivity and slowing economic growth.

B) It can render the economy vulnerable to sudden changes in remittance receipts.

3) India’s Remittance Dependence– India’s dependence on remittances is fairly limited compared to other countries. While Tajikistan had a remittance-GDP ratio of 51% in 2022, the corresponding figure for India was about 3.3%.

How does India benefit from its large migrant population?

India benefits from a vast pool of migrants, both low-skilled and high-skilled. This contributes to various sectors of the economy.
However, the migration of low-skilled workers highlights the need for India to create more productive employment opportunities domestically.

What should be the way forward?

Economic Diplomacy-India must strengthen its capabilities to address problems faced by Indians living abroad that includes cases of discrimination, exploitation, repatriation, and keeping track of the whereabouts of Indians overseas.

Question for practice

Highlight the contribution and concerns regarding remittances in Indian economy? What are the challenges faced by Indian workers abroad?