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Indians spend record $31.7 billion abroad in FY24, up 17% this year

MUMBAI: Indians spent a record $31.7 billion abroad during the liberalized transfer scheme in FY24, an increase of nearly 17% over the USD 27.1 billion recorded in FY23. The increase has been despite the imposition of tax collection at source. However, data analysis shows that the monthly average consumption decreased after the introduction of TCS in October 2023.
The annual data for remittances shows that Indians have increased traveling abroad with a vengeance, spent US$17 billion on it in FY24 – up more than 24.5% from US$13.6 billion in the previous year. international travel in spending under the LRS has increased to 53.6% in FY24 from 37% in FY20 before the onset of the pandemic. In FY21, international travel spending had fallen to $3.2 billion due to restrictions on mobility.

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On the other hand, the share of remittances going to education abroad has steadily declined. In FY21, remittances to education were 30%, mainly because travel was subdued during the pandemic. The share fell to 26% after travel restrictions were lifted in FY22. Expenditure on education fell in FY23 in absolute terms to $3.4 billion from $5.2 billion the previous year, resulting in its share of total spending falling to 12%. In FY24, study abroad spending was flat at nearly $3.5 billion, although travel spending increased.
As a result of less expenditure on fees, study abroad is no longer the second largest category in foreign exchange expenditure. Indians have spent more on maintaining relatives abroad ($4.6 billion) than on fees.

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