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Will recent events in the Middle East Affect Remittance Flows to South Asia?

Ceren Ozer's picture

For countries with substantial numbers of workers in the Middle East, recent events have not only raised concerns for the repatriation and welfare of their citizens, but have also raised fears of a possible slowdown in remittances. Will remittance flows noticeably decrease due to recent events in Egypt, Libya, and Tunisia?

For South Asian countries, remittances are among the largest and most stable sources of foreign exchange and their developmental impact have been remarkable. For example, in Nepal national poverty level has come down from 42% to 31% during 1996 to 2004, and to 21% today, largely on the account of remittances which finance household consumption as well as education and health expenditures. Nepal, Bangladesh, and Sri Lanka, were among the top 15 remittance recipients in 2009—with inflows being equivalent to 24% of the GDP in Nepal, 12% in Bangladesh, 8% in Sri Lanka, 5% in Pakistan and 4% in India.

Gulf States employ more than 11 million expatriate workers, an estimated 8 million or more from South and East Asian countries. Saudi Arabia, the U.A.E, and Qatar are top destination for South Asian migrants and are main sources of remittance inflows. The table as well as the country profiles below demonstrates the sheer magnitude of migrant workers in the Arab Gulf countries and their contributions to the labor force; sometimes greater in overall numbers and proportion than the respective labor force in the countries.

Solar Home Systems: Lighting up Bangladesh's Countryside

Naomi Ahmad's picture

Lives no longer interrupted by the setting sun…

We were walking towards the small bridge over the canal. The sun had already set and dusk was gradually fading into darkness. The winter air was quiet and still. Approaching the highest point of the bridge, I could sense the excitement in our quickening footsteps - we were almost there.

The project officials had told us that we could see it all, if we stood and looked out from the highest point of the bridge. So we leaned over the railings and waited, straining to see. But there was nothing – just the fuzzy darkness, gradually thickening and settling quietly on the land. I was left wondering whether we were just on a wild goose chase.

Then down below, a faint light suddenly flickered to life. A bulb was turned on in the darkness. Then another glowed – and yet another! In a few minutes, the area lying below us was glimmering with the tiny dots of faint white light bulbs. And from our high vantage point we could clearly see that the sleepy little rural marketplace - Garjon Bunia Bazaar – had woken up; ready for another evening.

Padma Bridge: Connecting People to Prosperity in Bangladesh

South Asia's picture

The Padma Bridge is expected to unlock the potential and transform the lives of nearly 30 million Bangladeshis living in the country's Southwest region. By reducing distances to major urban centers like Dhaka by almost 100km, the bridge will facilitate regional trade, reduce poverty while accelerating growth and development in the country as a whole.

The construction of the bridge would fulfill the long-standing dream of the people of the Southwest region to have a permanent crossing over the Padma River,” said World Bank South Asia Vice President Isabel Guerrero.


For more information, read the Feature Story and Press Release.

India's Karnataka State Pioneers a Holistic Approach to Watershed Development

South Asia's picture


The Karnataka Watershed Development project - also known as Sujala - has increased the availability of water in seven drought-prone districts of northern Karnataka. Treatments on the upper and lower reaches of watersheds have helped raise water tables, brought degraded lands under cultivation, enabled farmers to diversify into higher value crops and horticulture, and raised agricultural productivity. State of the art remote sensing has been used to monitor impacts. Incomes for both the landed and landless poor have increased.

The price of success – and how can we ensure that we can afford to pay it?

Sundararajan Gopalan's picture

Talking to a Sri Lankan friend about his 80-year old mother, who has been living alone ever since his father passed away 4 years back, brought back memories of my own mother who passed away at the age of 76 in 2008. As my Sri Lankan friend was worried about his mother’s living arrangements (he is happy to have her move in with him, but she prefers to stay alone in the house that has been her home for 46 years), I began to muse about my own father who lives alone at 85 years. He is in reasonable health for his age, and is largely independent, except that he needs oxygen support every night while sleeping as his lungs have lost significant capacity due to fibrosis, and his eyesight has deteriorated considerably. I was feeling guilty for not taking care of him in his old age. Again, it is his decision not to move in with any of his children, as he wants to stay in the apartment which he is familiar with and to be ‘independent’. We have appointed a care-taker who stays with him all day, while my sister and brother-in-law who live just a kilometer away give him company in the nights. Still the guilt feeling is no less.

The Value of Connected Savings

Daniel Radcliffe's picture

The business case for low-balance savings is tough, as the margin on float may not amount to much. In much of South Asia, the economics of savings for the poor has been buttressed by microcredit – the notion that the account anchors the customer relationship and the loan gives it profitability. But financial inclusion premised on credit is always going to leave some people behind: those who do not feel like credit is the right financial tool for them or who simply do not have the ability to commit to future payment streams.

A new vision is emerging around integrating the savings proposition into a broader payments network. Offering “connected savings” accounts rather than stand-alone accounts helps the economics of low-balance savings in three ways:

Capitalizing on the Demographic Transition

Michael Engelgau's picture

For decades, the leading causes of mortality have differed between low income countries and high income countries. Those who have worked their careers in health and development probably never thought they would see the day when maternal/child health and communicable diseases would not be the leading health burden in many low income countries.

The new actor is non-communicable diseases (NCDs), which are characterized by chronic diseases (cardiovascular disease, diabetes, cancer, and chronic respiratory disease), along with injury and mental health which are now responsible for half the health burden in South Asia. Thus, the challenge now is how best to juggle this “double burden”.

Currently, many compelling reasons are pushing countries toward starting to tackle NCDs. From both a social and political standpoint, South Asians are 6 years younger than those in the rest of the world at their first heart attack. This type of trend threatens a country’s ability to fully capitalize on the demographic dividend from a larger mature working force because healthy aging is necessary, which in turn, requires tackling NCDs.

Racing to the Top at Economic Students Meet

Joe Qian's picture

An unmistakable sense of achievement and enthusiasm emanated through the halls of the 7th South Asia Economics Student Meet held in Colombo, Sri Lanka last month. The theme of Economic Freedom and Poverty Reduction in South Asia brought together 192 of the top economics undergraduates from universities throughout the region to showcase their economic knowledge and talent.

Demonstrating superior knowledge, creativity, and critical thinking skills; the participants exchanged ingenious ideas in exploring creative solutions to regional economic challenges while making new friendships to pave the way for greater mutual learning as emerging leaders and future policy makers.

Students from universities in Bangladesh, India, Nepal, Pakistan, and Sri Lanka participated in the 3-day conference focusing on economic freedom. As Professor Bishwambher Pyakuryal from Tribhuvan University in Nepal noted, “countries with higher degrees of economic freedom also tend to have higher incomes and levels of development.”

Gender and Climate Change: Myth vs. Reality

Nilufar Ahmad's picture

This season in Bangladesh marks the 40th anniversary of the 1970 cyclone which ravaged the southern coast and killed over half a million people, decimated the homes of countless families, destroyed millions of livestock, key infrastructure, and damaged productive land. The recent cyclones Sidr in 2007 and Aila in 2008 also claimed the lives of over 3000 people each, leaving millions of poor more vulnerable to climate change than ever before. In the wake of all these cyclones, questions were raised about how to build resilience to climate change impacts without compromising national development goals. Is Bangladesh developing differently? What lessons can be learned from experience of Bangladesh to reframe development and climate action as mutually supportive objectives?

Bangladesh Local Governance in Practice: Journalists Strengthen Citizens’ Voice

Nilufar Ahmad's picture

The Bangladesh Non-lending Technical Assistance on Local Governance (NLTA) is a policy and technical assistance instrument of the World Bank complementing the Bangladesh Local Governance Support Project (LGSP) that has been supporting the Union Parishad (UP), the rural local government since 2006. The NLTA, supported by the Swiss Development Cooperation (SDC), Norway and AusAID, is broadening the dialog on decentralization, strengthening intergovernmental frameworks, and enhancing downward accountability and citizen’s voice in local governance.

Under the NLTA program, one journalist from each of 64 district press clubs was trained in LGSP rules and social accountability process and established a Local Governance Journalist Network (LGJN) in early 2009. This network of journalist is carrying out investigative reports as “third party monitors” on the implementation of LGSP. They are also facilitating local level dialogues between UPs and communities; facilitating citizen’s to hold the UP accountable.

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