Lok Sabha Question No. 3193 (UNSTARRED), answered on 2015-08-07
Subject: Foregin Remittances from Indian Work Force
Ministry: FINANCE
Asked by: E. AHAMED, MALLIKARJUN  KHARGE

## 3193: SHRI AHAMED & SHRI MALIKARJUN KHARGE;

Will the Minister of FINANCE be pleased to state:

- (a) The details of remittances/private transfers by Indian workers abroad/nonresident Indians during each of the last three years and the current year, country-wise;
- (b) The steps taken by the Government to further enhance the flow of  foreign remittances through this route to India;
- (c) Whether the  Government  has  imposed  service  taxes  on  such  remittances  causing  hardships  to poor unskilled workers, I so, the details thereof and the reasons therefor; and
- (d) The action taken/proposed to be taken by the Government in this regard?

## ANSWER

## MINISTER OF STATE IN THE MINISTRY  OF FINANCE

## (SHR IJAYANT SINHA)

- (a) The  details  of  remittances/private  transfers  by  Indian  workers  abroad/Non-Resident  Indian  as recorded in India's balance o payments statistics are as follows

Table 1: Remittances (Private Transfers) received by India

| Year    | Gross   | Net    |
|---------|---------|--------|
| 2012-13 | 67,627  | 64,342 |
| 2013-14 | 69,638  | 65,481 |
| 2014-15 | 69,831  | 66,275 |

Country-wise  information  on  remittances  is  not  available,  Survey  based  region-wise  information  on remittances/private transfers as provided by RBI is at Annex.

- (b) To further enhance the flow of foreign remittances to  India, it has been decided to amend the definition of Non Resident Indian as contained in the FDI policy, and also to provide that for the purposes of FDI policy, investment by NRIs under Schedule 4 of FEMA (Transfer or issue of Security    by  Persons  Resident  Outside  India)  Regulations  will  be  deemed  to  be  domestic investment  at  par  with    the  investment  made  by  residents.    Further  Non-resident  Indians  are allowed  to  subscribe,  through  banking  channel  and  on  non-repatriation  basis,  to  chit  funds, without limit subject to the conditions stipulated by the Reserve Bank of India. I
- (c) Remittances being a transaction in money, does not constitute 'service' for the purpose of levy of service tax.  Therefore, remittances per se do not attract serve tax, Service tax would apply only to a taxable activity, if any, undertaken in the taxable territory, by a service provider in relations to such remittances.
- (d) Does not arise in view of reply to © above.

Annex  referred  to  in  part  (a)  of  Lok  Sabha  Unstarred  Question  No.  3193  to  be  answered  on  Friday, August 7, 2015

| Region-wsie Distribution of Private Transfer Receipts in India   | Region-wsie Distribution of Private Transfer Receipts in India   | Region-wsie Distribution of Private Transfer Receipts in India   | Region-wsie Distribution of Private Transfer Receipts in India   | Region-wsie Distribution of Private Transfer Receipts in India   | Region-wsie Distribution of Private Transfer Receipts in India   | Region-wsie Distribution of Private Transfer Receipts in India   | Region-wsie Distribution of Private Transfer Receipts in India   | Region-wsie Distribution of Private Transfer Receipts in India   |
|------------------------------------------------------------------|------------------------------------------------------------------|------------------------------------------------------------------|------------------------------------------------------------------|------------------------------------------------------------------|------------------------------------------------------------------|------------------------------------------------------------------|------------------------------------------------------------------|------------------------------------------------------------------|
| Period                                                           | Gulf Countries                                                   | North America                                                    | South America                                                    | Europe                                                           | Africa                                                           | East Asia                                                        | Others                                                           | Total                                                            |
| 1                                                                | 2                                                                | 3                                                                | 4                                                                | 5                                                                | 6                                                                | 7                                                                | 8                                                                | 9                                                                |
| 2009-10                                                          | 16,431                                                           | 15,934                                                           | 2,197                                                            | 10,446                                                           | 1,731                                                            | 2,250                                                            | 4,647                                                            | 53,636                                                           |
| 2010-11                                                          | 20,506                                                           | 19,097                                                           | 1,449                                                            | 6,794                                                            | 1,618                                                            | 3,734                                                            | 2,421                                                            | 55,618                                                           |
| 2011-12                                                          | 24,382                                                           | 2,706                                                            | 1,723                                                            | 8,078                                                            | 1,923                                                            | 4,440                                                            | 2,878                                                            | 66,129                                                           |
| 2012-13                                                          | 24,934                                                           | 23,220                                                           | 1,762                                                            | 8,260                                                            | 1,967                                                            | 4,541                                                            | 2,943                                                            | 67,627                                                           |