India's next billion dollars from abroad may depend on easier visas

India's remittance boom has powered through global crises, geopolitical tensions and economic slowdowns, helping make the country the world's largest recipient of money sent home by overseas citizens since 2008.

However, as the source of those remittances shifts from the Gulf to advanced economies, economists say the next phase of growth could increasingly depend on immigration policies in countries such as the US, Canada, the UK and Australia.

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The concern is not that remittances will suddenly collapse. Rather, tighter visa rules, higher salary thresholds and restrictions on temporary migration could slow the pipeline of new migrants, making future growth more uneven.

According to the Finance Ministry’s June 2026 Monthly Economic Review, gross remittance inflows rose to a record $155.1 billion in FY26 from $135.4 billion in FY25, an increase of 14.5%. The inflows were equivalent to around 4% of GDP. Separately, RBI balance-of-payments data cited by the government put net private transfers at $144.8 billion for the year, reflecting a narrower measure after accounting for outward transfers.

India's remittance story remains structurally resilient, but the risk profile is changing, said Gaurav Mehndiratta, Partner and Head, Corporate and International Tax at KPMG in India.

“There does not seem to be an immediate risk of a sharp fall in remittances or FCNR inflows, but tighter immigration policies globally could moderate the pace of growth over the medium term," Mehndiratta said.

The Gulf no longer calls the shots

The source of India’s remittances has shifted significantly.

According to the Reserve Bank of India's Sixth Remittances Survey, advanced economies have overtaken Gulf countries as the largest source of inward remittances, reflecting the growing share of skilled Indian professionals working in developed markets.

Remittances into India stood at $118.7 billion in FY24, with the US accounting for 27.7% of total inflows, followed by the UAE (19.2%) and the UK (10.8%). Singapore, Saudi Arabia, Canada and Australia were among the other major contributors.

The shift means India's remittance outlook is now increasingly linked to immigration and labour market policies in developed economies rather than oil-driven employment cycles in the Gulf.

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"The earlier model was more Gulf-heavy and driven by lower and semi-skilled workers. The newer growth engine is increasingly linked to high-skilled professionals in advanced economies," Mehndiratta said.

"This means remittances may be higher per migrant, but also more sensitive to skilled visa rules, post-study work policies, family relocation patterns and permanent migration decisions."

The real test is who's next

Experts say the immediate risk is limited because millions of Indians already living overseas are expected to continue sending money home.

The bigger question is whether future migration will remain as strong.

"So far the risk is concentrated on new immigrants. The NRI base in these countries is already large, so the risk is not one of a large-scale destruction of current inflows but of incremental growth and diversification," said Vishad Turakhia, CEO of Equirus Securities.

Countries including the US, Canada, the UK and Australia have tightened immigration policies in recent years by raising salary thresholds, reducing temporary migration programmes or making employer-sponsored visas more restrictive.

According to Mehndiratta, these measures pose a greater long-term risk to India's remittance growth than workforce localisation programmes in Gulf countries.

"Gulf localization affects the volume base of Indian migration, while restrictions in the US, Canada, UK and Australia could affect the higher-value growth engine of future remittances," he said.

Why these dollars matter

Remittances are one of the pillars of India's external account.

Along with net services exports, they help finance the country's current account deficit, support household consumption and provide a stable source of foreign exchange during periods of global uncertainty.

"Alongside net service inflows, remittance inflows have been imperative for managing India's CAD and overall BoP," Turakhia said.

The RBI's latest survey also highlights how remittance flows are concentrated within India. Maharashtra was the largest recipient state, accounting for 20.5% of total inward remittances, followed by Kerala (19.7%), Tamil Nadu (10.4%), Telangana (8.1%) and Karnataka (7.7%).

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Apart from remittances, NRI deposits remain another important source of foreign currency. According to Turakhia, India's NRI deposit base has grown from around $67 billion in 2013 to nearly $167 billion currently, while FCNR(B) deposits have continued attracting around $6-7 billion annually even without special mobilisation windows.

"Yes, tighter immigration policies matter but they are a slow-burn risk for deposit mobilization," Turakhia said.

Mehndiratta added that India is not excessively dependent on remittances alone, given continued support from services exports, FDI, portfolio flows and other external financing channels.

The warning signs

Neither expert believes India is heading towards a remittance cliff.

Instead, they expect the next phase of remittance growth to become more policy-sensitive as developed economies tighten immigration rules and overseas migration patterns evolve.

The indicators to watch include RBI data on private transfer receipts, corridor-wise remittance flows, work visa approvals in major destination countries, NRI deposit growth and secondary income in the balance of payments.



"We will be closely watching RBI's remittance surveys, new work visa approvals in the US, UK, Australia, GCC and advanced economies, organic NRE/NRO deposit inflows, and secondary income in the balance of payments," Turakhia said.
Mehndiratta said slower family maintenance transfers, weaker remittance-linked consumption in major recipient states and softer FCNR deposit mobilisation would also signal a structural shift.

"Overall, India is not facing a remittance cliff. However, remittance growth may become more uneven and more policy sensitive. The next phase will depend less on the number of Indians overseas and more on the quality of jobs, permanence of migration, host-country visa regimes and the financial behaviour of a more settled diaspora," he said.