Economic Survey: India remains world’s largest recipient of remittances

The Economic Survey tabled in Parliament on Thursday by Finance Minister Nirmala Sitharaman says ‘India’s external sector remains strong, with deepening global integration driven by robust exports, resilient services trade, and expanding trade networks. This reflects increased competitiveness, diversification, and adaptability to global demand.’

It says India’s current account structure reflects a merchandise trade deficit offset by strong net inflows of invisibles, led by rising surpluses in services and private transfers. In H1 FY26, the Current Account Deficit (CAD) moderated to USD 15 billion (0.8 per cent of GDP) from USD 25.3 billion (1.3 per cent of GDP) in H1 FY25. India is better positioned than its high-deficit peers, such as New Zealand, Brazil, Australia, the UK and Canada in Q2 FY26.

Advertisement

The survey notes that India remained the world’s largest recipient of remittances, with inflows reaching USD 135.4 billion in FY25, supporting stability in the external account. The share of remittances from advanced economies increased, reflecting a growing contribution from skilled and professional workers.

India has consistently attracted sizable gross investment inflows, amounting to 18.5 per cent of GDP in FY25, even amid tightening global financial conditions. According to UNCTAD data, India remained the largest recipient of gross FDI inflows in South Asia and surpassed major Asian peers such as Indonesia and Vietnam.

India ranked fourth globally in Greenfield investment announcements in 2024, with over 1,000 projects and emerged as the largest destination for Greenfield digital investments between 2020 and 2024, attracting USD 114 billion. In April-November 2025, gross FDI inflows strengthened to USD 64.7 billion, compared with USD 55.8 billion in April-November 2024. This highlights sustained investor confidence despite a subdued global environment and reflects the underlying strength of India’s digital economy.

India’s foreign exchange reserves increased to USD 701.4 billion as of 16 January, up from USD 668 billion as of the end of March 2025. In terms of adequacy, the reserves are sufficient to cover around 11 months of goods imports and about 94 per cent of the external debt outstanding at the end of September 2025, providing a comfortable liquidity buffer.