Tuesday, May 19, 2015

Migration Series - 2

Let us start from Migration Series - 1. Once there was a popular myth: in the Government and Development Sector: Migration of 'poor' rural population is bad idea. Even when higher caste population was migrating towards cities for education, the government was launching various schemes on poverty reduction in the villages to prevent people from moving to the urban areas. So, why is the Migration Issue ? Migration – when it is safe, legal, and voluntary – is the oldest poverty-reduction and human-development strategy [Migration, Development and Poverty Reduction in Asia] . As per Wiggins & Keats [Stepping out of agriculture] - "Migration takes various forms, distinguished by:  Destination – international versus domestic, rural to urban, rural to rural and urban to urban; and, Length of absence – permanent moves of a year or more, and seasonal moves – to which might even be added daily commuting."

Many moves are not permanent, but vary from seasonal and circular. The reasons for out-migration can vary as a result of debt at home combined with high unemployment level and poor wages for jobs in the village. The availability of temporary jobs in the nearest vicinity with boom in urban development leads a huge circular migration pattern daily. Temporary migration is a routine livelihood strategy for the poor in India  rather than coping strategy to “keep the wolves at bay".

Migration Pattern in India
There is migration from landlocked BIMARU state towards places having either industrial hubs or agricultural prosperity.The tussle between migrants and ‘people of the soil’ has given rise to political right parties in Maharashtra.

Migration Pattern International 
Taking the estimates available, it seems that just over 3% of the world’s population are international migrants (UN Population Division, 2013), while domestic migrants are at least 12% of world population (Bell and Charles-Edwards, 2013).

Remittance Market

Remittances provide the most tangible link between migration and development, a relationship that has only increased in importance since the economic slump since 2008. Let us compare the Official remittance flows compared to other large monetary flows in 1990–2016 projection for India. The graph is constructed with World Development Indicators and World Bank Development Prospects Group. The remittances from the migrated Indians have played a major role in the development of India from 1990's to present day. Personal remittances are estimated towards value of above 70 Billion Dollars leading to major boost in local consumption. Even when FDI and portfolio equity has dipped during recession era of 2008, the personal remittance has grown in a major way in India.

Internal remittances are part and parcel of livelihoods for many poor families in the developing world with migrant members working in big cities. Internal migrants within far outnumber international migrants but the internal remittances, however, are often small.  Rural areas often receive the lions’ share of remittances. As rural-urban wage differentials grow, the returns from migration increase. India has the second largest domestic remittance market in the world (Tumbe 2011). It is also estimated that of the total domestic remittance flows in India only 30% are routed through formal channels. This is in stark contrast with China where 75% of the remittances are formally routed (ibid).

Are internal remittances contributing to poverty reduction? Remittances from urban employment are mainly used for such purposes as immediate consumption, repayment of loans, health care expenses, education and meeting other social obligations. Investments by migrant households in housing, land and consumer durable are common, and migrant income is also used to finance working capital requirements in agriculture as well as small businesses. . Those who are interested can  read World Bank report on The Remittance Market in India(PDF).

Remittances need to flow directly into the hands of the people who need it most. There is a lot of policy gap for this goal that must be addressed on urgent basis by the government.  Policy initiatives by the government and banking institutions have achieved an important result - Most remittances is flowing  through formal channels. India need to revamp their apparatus for issuing passports and regulate agencies that recruit unskilled workers. And internal migrants also need a lot of entitlements and services from the government and better mechanism for fund transfer through financial institutions. The social impact on the lives of migrants will be discussed in the last post of the migration series.

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