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Aided by international travel, outward remittances under the Reserve Bank of India’s (RBI’s) liberalised remittance scheme (LRS) during the April-January period of FY23 has already surpassed the FY22 figure, which was the highest ever in any financial year.
According to data released by the Reserve Bank of India (RBI), in its monthly bulletin for March, outward remittances under the scheme stood at $22.08 billion during the April–January period.
In January 2023 alone, the amount remitted overseas totalled $2.72 billion.
This is the highest amount remitted under the scheme in a month during the current financial year. In FY22, Indians had remitted a little over $19.61 billion overseas under RBI’s LRS scheme, which is an all-time high.
In FY21, outward remittances were badly hit as pandemic-related restrictions shut down international travel for a long time.
In FY21, India’s remittances stood at $12.68 billion, down 32.38 per cent from FY20. In FY20, the figure was $18.76 billion.
On a year-on-year (YoY) basis, outward remittances under LRS in January were up 35.17 per cent.
According to January data, international travel constituted over 55 per cent of the entire outward remittances by Indians under the scheme.
Outward remittances for international travel touched $1.49 billion, up 1.5 times from the same period in 2022. International travel was marred by Covid-related restrictions all over the world in 2021 and for some time in 2022. It slowly picked up towards the latter part of 2022.
After international travel, Indians spent most on overseas education, followed by maintenance of close relatives, and gifts.
According to RBI data, in January 2023, outward remittances by Indians under the scheme for overseas education were $395.87 million.
It was followed by $342.47 million for maintenance of close relatives, and $223.22 million as gifts.
According to the LRS scheme, which was introduced in 2004, all resident individuals, including minors, are allowed to freely remit up to $250,000 per financial year. This is for any permissible current or capital account transaction or a combination of both.
Initially, the scheme was introduced with a limit of $25,000.
The LRS limit has been revised considering the prevailing macro and micro economic conditions.
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