Cross-border workers’ remittances: Transmission channels and measurement issues in India

The debate on appropriate measurement of workers’ remittances and the greater need for conceptual clarity about such statistics both for the compilers and the users raises certain important issues. First, lack of uniformity in properly identifying and measuring remittances of migrant workers constrains the scope of international comparability. For instance, in many countries translated in the form of transfers to residents as unrequited transfers. These country specific formats of remittance transfers and their inclusion in the remittance statistics need to be clearly recognized. Thus, the definitional issues need clarity to provide direction to the compiling counties to produce comparable statistics. Second, the experience of developing countries suggests that the survey method has its own limitations due to poor response of participants, particularly in a more liberalized environment. Even under the ITRS, the introduction of formats seeking disaggregated information does not ensure quality of data when respondents are either not cautious in classifying the detailed transactions or lack adequate skill to handle such information. Missing incentive systems for the reporting entities may also result in inadequate data quality. Third, is there a need for synthesizing statistics on remittances and the migration statistics? To what extent the migration statistics can keep pace with the requirements of compilation of remittances in terms of updated information, and attributes such as changing structure of migrant stocks, skill classification, average income levels, duration of stay etc. Possibility to develop an appropriate information system through coordinated efforts of migration authorities, immigration offices, the population census and the BoP compilers? The scope for sharing the host country statistics on immigration, which is presumably credible due to firm record of immigrants. Fourth, as many countries rely on the ITRS, it becomes extremely difficult to segregate between workers’ remittances and the compensation of employees by the reporting entities. The thin dividing line is conceptual rather than functional and more often the reporting entities do not have details on the period of stay.