Is blue-collar migration to the Gulf becoming less profitable?

The share of migrants to the Gulf from the southern States has decreased while those from the north and east have remained high. Analysis of India’s remittance trends shows a shift from Gulf to advanced economies, impacting migrant-heavy states differently.

The latest data indicate a decline in the Gulf countries’ share of India’s inward remittances, while contributions from advanced economies have increased. The data also reveal that States with a declining share of migrants to the Gulf countries are seeing a growing share of India’s inward remittances, while those with higher migrant outflows to the Gulf contribute only a minimal—and further decreasing—share.

These trends have a significant impact on States such as Bihar, Uttar Pradesh, Rajasthan, and West Bengal, which have continued to send large numbers of workers to the Gulf countries over the past decade. In contrast, States such as Tamil Nadu, Kerala, Andhra Pradesh, Telangana, and Punjab — historically major contributors of migrants to Gulf migration — have seen a considerable decline in the number of emigrants.

Table 1 shows the country-wise share of India’s inward remittances for the years 2016-17 and 2023-24.

The UAE’s share dropped from 26.9% to 19.2%, Saudi Arabia’s from 11.6% to 6.7%, and Kuwait’s from 6.5% to 3.9%. Conversely, remittances from advanced economies have increased. The U.S.’s share rose from 22.9% to 27.7%, the U.K.’s from 3.4% to 10.8%, Singapore’s from 5.5% to 6.6%, and Canada’s from 3% to 3.8%.

Table 2 presents the State-wise share of India’s inward remittances for the years 2016-17 and 2023-24.

The data reveal an increasing share for States such as Maharashtra, which rose from 16.7% to 20.5%, Kerala from 19% to 19.7%, and Tamil Nadu from 8% to 10.4%.

In contrast, States such as Uttar Pradesh, which already had a low share of 3.1% in 2016-17, saw a slight decline to 3% in 2023-24. Similarly, West Bengal, Rajasthan, and Bihar maintained consistently low shares, ranging between 1% and 3% during this period.