Indian citizens, over the past year, have spent significantly more on overseas travel, according to the Reserve Bank of India (RBI) data. With an increase in the number of Indians travelling abroad, the outward foreign exchange remittance jumped to $1.42 billion (around ₹12,500 crore) a month on an average in 2023-24, as compared to just $400 million in 2018-19.
According to RBI data, Indians took out a total of $17 billion ( ₹1,41,800 crore) in 2023-24 for overseas travel under the central bank’s liberalised remittance scheme (LRS), a 24.4 per cent bump compared to last year.
Under LRS, all resident individuals, including minors, can remit up to US $250,000 (approximately ₹2.08 crore) abroad a year without prior approval from the RBI.
Foreign travel for Indians accounted for over 53 per cent of the total outflows in FY2024, emerging as the country’s primary source of remittance outflow. In 2013-14, this stood at just 1.5 per cent; in 2018-19, the outflow was 35 per cent.
The heightened interest in foreign travel among Indians can be linked to the increase in disposable income and the growth of the middle class. There was also a spike in foreign travel after the restrictions during the COVID-19 pandemic were lifted worldwide.
Notably, international travel expenses had plummeted to just $3.2 billion in FY2021 due to travel restrictions amid the pandemic.
“The share of maintenance of close relatives has remained around 15 per cent over the last 10 years. However, there has been a sharp decline in the share of gifts and education in this period,” reported the Indian Express, quoting a Bank of Baroda report.
Indians made significantly more foreign investments this year, not just foreign travel. Resident Indians invested $100 million abroad per month on average in 2023-24, showed the RBI data. Remittances for ‘maintenance of close relatives abroad’ were $4.61 billion and ‘studies abroad’ were $3.47 billion in 2023-24.