The cross border movements of people and increasing diversity of societies are inevitable. Any kind of migration if it is national or international, creates significant financial and social benefits for migrants, for their families, for the cities and countries of origin and destination. Every year thousands of workers move overseas, away from family and friends, to seek better employment that will produce an improved quality of life for themselves and those loved ones they have left behind in their countries and homes. The salaries earned by migrants and the resulting surplus funds sent home are known as remittances. Remittance constitute the second largest flow of capital to developing countries, behind only governmental development aid.

Remittances play an important part in developing the countries' economic systems, individual households, and businesses. Since 2009, the World Bank has acknowledged the importance of remittances by including them in its measure of creditworthiness, allowing nations with high remittance levels to borrow more money than they otherwise could. In the latest edition of the Migration and Development Brief, the Bank estimates that officially recorded remittances to developing countries amounted to $429 billion in 2016, a decline of 2.4 per cent over $440 billion in 2015. Global remittances, which include flows to high-income countries, contracted by 1.2 per cent to $575 billion in 2016, from $582 billion in 2015.

But how does it impact the Indian economy?
In the recent past, India has been reporting a remarkable rise in its economic growth. Prior to the global economic crisis, factors related to the external economy such as liberalization of the economy, globalization and increased FDI (foreign direct investment) were cited as the major drivers of this growth process. However post-crisis, internal factors, such as domestic consumption, strength of the regulatory and other institutions, and the country's demographic profile, are being appreciated for their role in the sustained growth of the economy. According to the Ministry of Overseas Indian Affairs (MOIA), around 25 million NRI contribute to the inward remittance. Every year these NRIs send billions of money in remittance to their families back home. There are many households who are dependent on this money that are sent to them by their family member's working abroad. Inward remittance forms around 22%-23% of the country's foreign exchange money. Though India does not heavily depend on this money, but still it adds up to the economy. In recent times, the RBI had been trying to encourage the NRIs to invest and send more money back home. In 2010, there was a de-regulation on the interest rates of the NRO and NRE accounts, thus helping the NRIs to deposit and bank in India. One more factor for the rise of remittance was the strong value of the US dollar in respect to the weak Indian rupee. Thus it led to more Indians depositing money in their Indian accounts. Though there was a global slow down, still migrants kept on sending money. India is seeing quite a remarkable rise in its economy. Before the economic downfall, FDI's globalization, liberalization of the economy was contributed as the largest share of the external economy.

As populations in developed countries continue to age, the demand for migrant labour is expected to keep growing in the coming years. However, remittances can help the families of migrants build a more secure future, making migration for young people more of a choice than a necessity. The global remittance market is vast and impacts both low income and high income countries in significant ways. Salary levels in high income countries are approximately five times those in developing countries for similar occupations, creating a massive incentive to emigrate. Migrants are earning industrial country salaries yet sending and spending that money in their native countries. The additional income created by remittances goes much further in developing countries where domestically generated goods are traded in local currencies. This enables the standard of living of the recipient. and thereby the overall economy of the receiving country, to improve due to an influx of wealth and buying power.

Regulation of Remittance Flows
There is a need to strike a balance between a regulatory regime that minimizes money laundering, terrorist financing, and general financial abuse, and one that facilitates the flow of funds between hard-working migrants and their families back home. Remitters use informal channels because these channels are cheaper, better suited to transferring funds to remote areas where formal channels do not operate, and offer the advantage of the native language and, on rare occasions, anonymity. Informal channels, however, can be subject to abuse. Strengthening the formal remittance infrastructure by offering the advantages of low cost, expanded reach, and language can shift flows from the informal to the formal sector. Both sender and recipient countries could support migrants' access to banking by providing them with identification tools.

The Conclusion
There is tremendous potential for using remittances to encourage development in countries. Yet, much progress has been made toward understanding remittances, the limitations mentioned above highlight how their potential impact is significantly reduced. Learning more about the best ways to capture and make use of remittances will require reconsidering how financial inflows are received in countries. In addition, development policymakers will need much more research on how to use remittances so they positively contribute to migrants' home communities and countries.