How remittances have shaped the socio-economic landscape of Kerala

#Kerala, #migrants, #opinion, #remittances

Representative image

The historic discovery of oil in West Asia and the subsequent commercialisation of it in the 1960s stimulated great demand for skilled and unskilled labour.

Keralites, confronted with a stagnant economy and unemployment at home, capitalised on this opportunity, triggering a wave of migration and heralding the gulf boom. In decades to come, Kerala achieved a series of economic and social changes aided by international remittances.

Before the Gulf boom, Kerala experienced the paradox of economic underdevelopment in the face of high human development indicators. This changed after the inflow of remittances. The consequent rise in consumption, savings and social investments augmented the domestic economy, spearheading a cultural and social change in the society.

As per the Kerala Migration Survey 2018, about 38 percent of the household remittances was used for daily living expenses. About 19 percent had cash in hand/bank, 12 percent used it to pay back debts, and 8 percent used the money for children’s education. Between 2013 and 2018, the remittances for day-to-day expenses increased by 42 percent and children’s education by 26 percent. This data suggests that the money has been directed toward improving human capital and living standards, which has benefited not only the direct recipients but also the society at large.

Supermarkets

The emergence of the supermarkets in the 1990s and the early signs of shopping complexes, including that of malls, even in Kerala’s interiors, were beneficiary investments from the remittances.

Many non-banking financial companies (NBFCs) and majority of cooperative banks have benefited from savings and fixed deposits from non-resident Keralites.

The lack of investment options and not-so-conducive climate for doing big business in Kerala propelled many of them to set up small and medium enterprises, eateries and cloth bazaars in Kerala.

The influence of remittance can’t be ignored in the education and in the health sector. The demand for English medium schools and the sprawl of the unaided schools meeting the market demands were largely propelled by the remittance economy.

Healthcare

As many studies have pointed out, Malayalees’ spending habits for healthcare leans towards the private sector in the search for more quality.

This has catalysed the education and health sector in Kerala. Indirectly, it opened up the means for a better lifestyle and improvement in the living conditions. Later on, non-resident Indian (NRI) quota (read high fees) in the professional engineering colleges helped many of these private institutions to thrive in times of financial difficulties.

One must also admit that the politics in Kerala and the finance and funding of the political parties depend a lot on NRKs. From the bucket collection methods in Kerala to the fundraising trips of senior leaders to West Asia, these are the no-so-secret benefits of remittance and the NRK community. Financing election campaigns is another ground for the NRKs to cooperate with the politics of Kerala. Philanthropy at the local level has increased over the years; funding local festivals and health emergencies are examples of such benevolent acts.

The families of NRKs have been able to come out of the poverty traps they inherited from their ancestors within one or two generations. The upward mobility of the NRKs is evident in Kerala’s social structure.

Dwindling future

The long history of migration has begun to reverse in recent years. As a percentage of NSDP, remittance constituted 19 percent in 2018 (KMS, 2018) down from 36 percent in 2014. This was accompanied by the slowdown in emigration trends from 2013 to 2018. The return migration has increased from 2013 to 2020 due to the recent pandemic.

#Kerala, #migrants, #opinion, #remittances

With the onset of the pandemic, economic conditions worldwide took a downward slide triggering a mass layoff and wage reduction. Kerala emigrants took the hardest hit in the pandemic. This, combined with the decline in emigration and remittance trend, indicates that the state may continue to see less remittances. There is no certainty that remittances will give steady inflows. It is, therefore, important that timely action be taken to strengthen the economic base by ensuring that the inflows are directed to productive and sustained income-generating activities.

A survey conducted by RBI in 2013 indicated that the frequency of sending remittances was found to be the highest for Kerala but the findings about the possible end-use of the funds remitted by overseas Indians to their families back in Kerala revealed that remittances were predominantly utilised for consumption, followed by savings. Investments formed a negligible portion compared to other centres.

This is also reflected in the credit-deposit (C-D) ratio. At 60 percent, the CD ratio of the state is the lowest in all India, indicating high growth in deposits and low credit. Much needs to be done to improve the allocation of money through improvements in the overall investment climate.

It is not difficult to assess the impact of less remittance to Kerala as it is an important element in the state’s socio-economic, political, and cultural fabric. While the state government is reeling under pressure from the lack of revenue generation and high welfarism adopted over the years, the remittance cushioned the state to stretch its boundaries. Coffers would be left dry and sticky if the remittance dwindled even by a few percentage points.

Views are personal and do not represent the stand of this publication.

News Related

OTHER NEWS

S. Korea's Hanmi, Celltrion, and Dongbang to produce Merck's COVID-19 pill

Hanmi will manufacture the finished drug and produce ingredients. South Korea’s Hanmi Pharm Co., Celltrion Inc., and Dongbang FTL were among 27 drugmakers chosen to produce low-cost versions of Merck ... Read more »

Fuerzan el séptimo; hoy hay campeón en la LMP

CIUDAD DE MÉXICO. © Excélsior Ávila pegó elevado de sacrificio para la carrera de la victoria. Foto: Tomateros de Culiacán Un error del antesalista Agustín Murillo abrió la puerta para ... Read more »

Former CBI chief Fairbairn joins race to head Channel 4

Dame Carolyn Fairbairn is among the candidates being considered as the next chairman of the state-owned broadcaster as its potential privatisation looms, Sky News learns. Read more »

Se apaga la poderosa voz de Meat Loaf

© Excélsior Fotos: Reuters CIUDAD DE MÉXICO. Meat Loaf, la estrella del rock estadunidense cuyo debut, Bat Out of Hell, se convirtió en uno de los álbumes más vendidos de ... Read more »

‘Takeover hunt for department store giant Kohl's: $9 billion bid on the table'

Insiders report this to Bloomberg news agency. The second-largest department store chain in the United States is under pressure from activist shareholders because it would underperform and the company would ... Read more »

Sources: US talks with Qatar about gas supplies to Europe

Photo: ANP The US government is in talks with Qatar about supplies of liquefied natural gas (LNG) to Europe if Russia were to invade Ukraine, causing European gas shortages. According ... Read more »

Hong Kong's home buyers snap up Henderson Land's The Harmonie flats, defying city's worst one-day explosion of new Covid-19 cases

Hong Kong’s property buyers turned out in droves, defying the city’s worst one-day explosion of new Covid-19 cases to snap up apartments at the first new housing project to be ... Read more »

Bonus rain at top US bankers: boss Morgan Stanley goes home with $35 million

The big boss at Morgan Stanley was paid a base salary of $1.5 million in 2021. On top of that came a cash bonus of $8 million and $5 million ... Read more »

Yes Bank posts 77% rise in December quarter profit on lower provisions, higher recoveries

yes-bank-300_36683164 Yes Bank on Saturday reported a 77% year on year growth in December quarter profit at Rs 266 crore as lower provisions and higher loan recoveries drove earnings at ... Read more »

Bloomberg: multi-billion dollar offer for major department store chain Kohl's

Photo: ANP The major American department store chain Kohl’s has received a takeover offer worth about $ 9 billion, converted almost 8 billion euros, from a group of investors. Insiders ... Read more »

Bitcoin rumbles further down: 25% fall in new year

On crypto platform Coindesk, bitcoin sees another 10% of its value evaporate to a position of $35,580 around 8 a.m. (Dutch time). This means that the digital currency has returned ... Read more »

Current economic landscape may not allow government to go for fiscal consolidation immediately: YES Bank chief economist

Read more »

Instagram's new subscription model: How it will aid Indian creators

While the features are being tested in the US, creators in India bet big on Instagram’s new subscription model. Instagram is testing three new subscription features under which followers can ... Read more »

Impact of oil firms' exit from Myanmar limited 'A lot more pressure needed to defeat this junta for good,' says human rights activist

The TotalEnergies logo is seen on a charging station in La Defense on the outskirts of Paris. The French company announced in Friday that it would pull out of Myanmar. ... Read more »

Payments Council urges rollback of no-fee transaction policy for UPI and Rupay debit cards

The industry estimates a loss of Rs 5,500 crore due to the Zero-MDR norm. (Representative image) The Payments Council of India (PCI), the industry body for digital payments, yesterday said ... Read more »

More trouble for PTC India as independent director quits after three board exits in arm over corporate governance issues

After PTC India Financial Services (PFS) came under the scanner with three of its independent directors resigning citing lapses in compliance and corporate governance, an independent director at the parent ... Read more »

Market falls over 3% but BSE smallcap index hits new high, 33 stocks gain 10-44%

After a positive start for the week on January 17 the Indian benchmark indices remained under selling pressure for the next four session’s in the week ended January 21 in-line ... Read more »

Ombudsman: Return to Australia for a DigiD

In the end, thanks to the help of an official Australian government agency, he manages to have his AOW paid out through the SVB. But he would also like to ... Read more »

Hawkish comments from the Fed may further strengthen the dollar which may not bode well for commodities: Kotak Securities' Ravindra Rao

Commodities witnessed strong gains this week despite the dollar strengthening and equities weakening as rising inflationary pressure drew investors, said Ravindra Rao, vice-president, head of commodity research, Kotak Securities. Inflation ... Read more »

As economies limp out of pandemic, here's how CII wants policymakers to steer post-COVID recovery

Representative image Growth appears to be limping back after COVID battered economies around the world, thanks to policy support from governments as well as vaccination drives. However, to ensure that ... Read more »

Transforming a ghost village with hill-centric livelihood and tourism opportunities

Major Gorki Chandola is reviving traditional practices in agriculture, construction and tourism to sustainably develop his village. Photo by Archana Singh. India’s northern state of Uttarakhand, known as the Land ... Read more »

Mining on the shifty sands of Goan politics

Mining machinery at a Goa mine brought to a halt by Supreme Court of India’s February 2018 judgment. Photo by Meera Mohanty/Mongabay. In the run-up to the 2022 state elections, ... Read more »

Clean energy startups innovate on products to aid farmers, rural areas

A three horse power solar panel installed in a village in Rajasthan by Agrivijay for irrigation works. Photo courtesy AgriVijay. Yash Tarwadi, 25, is a chemical engineer based in Surat ... Read more »

Energy major Shell sheds 'Royal Dutch' from name

Royal Dutch Shell | Headquarters: The Hague, Netherlands. Incorporated in the United Kingdom. (Photo: Reuters) Energy giant Shell has dropped from its name the ‘Royal Dutch’ part, which it had ... Read more »

Moneycontrol PRO & Espresso present Nifty Banker 2.0 on Saturday, 22nd January, at 8 pm, with Rohit Katwal on “Momentum Short - Index Option Selling using trend following on Nifty and Bank Nifty”

Nifty Banker 2.0 is India’s First Retail Index Traders Online Conference to be organised in the country. Some of the best index traders in India will share their deep trading ... Read more »

Why Always Hire A Professional and Experienced Tax consultant in vienna (Steuerberater Wien)

Accounting is, above all, strategic management by taking responsibility for drawing up the accounts. It is important to have this vision. Each year, accounting produces mandatory summary documents at the ... Read more »

NetEase apologises for ‘bad experiences' after fans of Harry Potter game revolt over Lunar New Year campaign

Chinese players of a video game based on the Harry Potter series of books by J.K. Rowling have staged an online revolt against NetEase, with their complaints about unfair game ... Read more »

Cryptocurrency crash wipes out more than US$1 trillion in market value

For bitcoin, there’s only been one constant recently: decline after decline after decline. And the superlatives have piled up really quickly. With the Federal Reserve intending to withdraw stimulus from ... Read more »

Moneycontrol Pro Weekender | Bubble Trouble 

Representative image Dear Reader, Jeremy Grantham, GMO’s chief investment strategist, has been warning for years about a bubble building up in the markets. In his latest missive, titled ‘Let The ... Read more »

Fed Launches Review of Possible Central Bank Digital Currency Officials solicit public comment, but are unlikely to decide soon whether to issue a government-backed cryptocurrency

“We look forward to engaging with the public, elected representatives, and a broad range of stakeholders as we examine the positives and negatives of a central bank digital currency in ... Read more »

Cryptocurrency Prices Today: Bitcoin falls 7%, Ethereum sheds 9%

(Image: Reuters) The global cryptocurrency market capitalisation dropped from $1.88 to $ 1.7 trillion during the last 24 hours while the trading volume surged from $66.35 to $126 billion. The ... Read more »

Daily Voice | Budget 2022 likely to be more populist rather than being mindful of fiscal gap, says Amit Jain of Ashika Wealth

Amit Jain is the chief strategist of Ashika Group and co-founder of Ashika Wealth Advisory Amit Jain, chief strategist of Ashika Group and co-founder of Ashika Wealth Advisory, feels earnings ... Read more »

Hedging, a must know activity for risk management: Shubham Agarwal

We will look at understanding Hedging today. Financial dictionary defines Hedge as ‘an investment to reduce the risk of adverse price movements in an asset’. In simple words an additional ... Read more »

Unilever Walks Away From Glaxo Consumer-Healthcare Deal Dove soap owner says it won't raise its $68 billion offer for the maker of Aquafresh toothpaste and Advil painkillers

The Unilever headquarters in London. The company’s offer to buy GlaxoSmithKline’s consumer-healthcare business has faced criticism about price and strategic fit. (Photo: Reuters) Unilever PLC said it wouldn't increase its ... Read more »

Singapore's first blank-cheque listings get off to a timid start, raising question whether the buzz around SPACs is fizzling out

A lacklustre market debut for the first two blank-cheque companies to list in Singapore is raising some questions whether the excitement seen for such vehicles in the US early last ... Read more »

Sony seeks new partners for transformative EV project

(Image: PTI) Sony Group (6758.T) will likely add new technology partners to its electric vehicle (EV) project to help it forge a mobility business to transform cars from transportation machines ... Read more »

Market snaps four-week winning streak on weak cues; rupee slips

Market snapped the four-week winning streak on rising concern over rate hike by central banks as foreign institutional investors continued selling. In the week, BSE Sensex shed 2,185.85 points (3.57 percent) ... Read more »

Children among ‘more than 70 killed' in Yemen airstrikes

© Ansarullah media center /AFP via This image grab from a handout video made available by the Ansarullah Media centre shows destruction at a prison in the Huthi rebel stronghold ... Read more »

S&P 500, Nasdaq post worst weeks since pandemic start as Netflix woes deepen slide

Representative image Wall Street’s main indexes ended sharply lower on Friday as Netflix shares plunged after a weak earnings report, capping a brutal week for stocks that saw the S&P ... Read more »

ICICI Bank independent director quitting to avoid potential conflict of interest

ICICI Bank. Representative image. ICICI Bank yesterday informed stock exchanges that Rama Bijapurkar will be stepping down as independent director from tomorrow, citing a potential conflict of interest. Bijapurkar in ... Read more »
On free-english-test.com you will find lots of free English exam practice materials to help you improve your English skills: grammar, listening, reading, writing, ielts, toeic