Of course, that did not happen. But, it is a tired-old joke from the old country that easily highlights the presence of Keralites (as in a person from Kerala, which is a state in southern India) seemingly in every corner of this planet--and on the moon too.
According to a recent survey, these expatriates number 1,625,653. Where are they?
Among them, 1426740 are in the Gulf countries.As in the countries by the Persian Gulf. Other estimates place the number even higher.
These expatriates send quite a lot of money back to their homeland:
Kerala has set a new record in remittances this year by already reporting a whopping 36 per cent year-on-year spike in inflows as of June-end at Rs 75,883 crore.The 75,883 crores of rupees are the equivalent of about 12 billion US dollars, which perhaps makes the expatriates the state's single largest export.
Kerala is, of course, only one example in a world where there are many of us who live in countries that are different from where we were born:
There are more than 230 million international migrants worldwide, which is more than the population of the world’s fifth most populous country, Brazil.
Out of those 230 million, 1.6 million are from Kerala. The twelve billion dollars from these expat Keralites were about a sixth of what India earned through its diaspora:
India received $70 billion, more than the value of its exports of information-technology services.More than the IT exports!
The Kerala, and India, stories might be big in the magnitude, but there are others with more impressive numbers:
In Tajikistan, as we have previously reported, migrant workers send home the equivalent of 47% of the country's GDP, and as many as half of the Tajik men in working-age are now believed to be living abroad. Similarly, an estimated 40% of Somalia’s population depend on remittances and need the cash to buy food and medicine.
All these lead to an interesting question: how much do these remittances help with local economic development?
I noted in this post, from more than four years ago, that the international remittances--and remittances from Keralites who work in other states in India--have not transformed Kerala into an economic powerhouse. Instead, Kerala has become a money-order economy. Kerala ranks high, even in the world, on various social development indicators, yes, but could that have been achieved without these international and domestic remittances?
While Sen gave credit to the numerous state-initiated welfare programmes, Bhagwati and Panagariya said that the state's achievement on both the counts was mostly due to the globalisation of the state's economy in the 1990s and the huge inflow of remittance from its large non-resident community.So, what are the effects of remittances on economic development? The Economist quotes from an IMF study:
decades of private income transfers—remittances—have contributed little to economic growth in remittance-receiving economies...the most persuasive evidence in support of this finding is the lack of a single example of a remittances success story: a country in which remittances-led growth contributed significantly to its development...no nation can credibly claim that remittances have funded or catalyzed significant economic development.And notes:
The cash may flow back but the human capital has left. If those who emigrated were not working anyway then the flow of remittances will have a positive effect, but if they were already working in the home economy then the impact will be more nuanced. Inward flows of remittances may boost national income, but GDP measures the output of a country. The effect of remittances on GDP growth therefore depends upon how the money is spent by the recipients.The export of human capital means that a Keralite scientist might have even worked for NASA and helped send Armstrong to the moon, and could have sent quite a few dollars back to Kerala. And the leftist politics in the state has certainly achieved remarkable social indicators, largely thanks to the money from elsewhere. But, after all these decades, does the state have a robust domestic economy, or are the youth from god's own country doomed to emigrate in order earn their livelihood, even if means setting up a chai stall on the moon?
2 comments:
Kerala is an interesting study. It is a highly educated, forward looking and dynamic society and yet it is economically a backward state. Its a beautiful example of both the positives and negatives of the extreme left.
In social indicators, it has performed well. Partly it is the culture, but its also partly because of government action. Left governments tend to do well in such matters - witness land reforms in Bengal, literacy in Kerala, absolute lack of corruption in Tripura. On average they tend to do better in education and health.
Where they go wrong is of course economic development. A big culprit is labour laws and industry bashing, taken to an extreme. Only an idiot would invest in Kerala, despite the educated workforce. Witness the IT industry blooming in three of the four southern states, but not in Kerala.
On the larger issue of immigrant labour, the calculations are nuanced, of course, but it is far better for them to emigrate (and remit moneys) rather than stay and have no opportunity. Labour is like water - it will flow to where it is needed. Better let it flow than artifically damming it.
Nothing to disagree with your comments ...
Here is how I look at it ... If Kerala has decided that literacy and health and everything else is important to them and that they would finance it by sending the young men and women to work in other states in the union and to other countries in the world, well, fine. But, we ought to understand that in there lie decisions on tradeoffs.
The Sen/Bhagwati debate, which got ugly, was essentially about Sen not acknowledging the tradeoffs and the importance of the financing coming from outside Kerala--the remittances. Sen was making it seem as if everybody could easily replicate the Kerala model, without bothering to highlight how that model works in terms of unemployment pushing its youth outside, like how in the IT-fueled south there is nothing happening in Kerala ... I have these problems even when I am a fan of Sen's and a not-so-fan of Bhagwati's ... imagine then the problems that Sen's critics have ;)
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