Indians’ outward travel remittances in Aug-Jul reach 57% of FY22 spending

Outward travel remittances between April and July for Indians this year have accounted for 57% of their international travel expenditures for last year according to data from RBI, as per media reports.

Indians have spent US$ 3.9 billion on international travel in the first four months of FY23 under the Reserve Bank of India’s Liberalised Remittance Scheme (LRS). During FY22, Indians spent US$ 6.91 billion on international travel, which was the second highest amount of remittance in one year. The highest travel remittance was recorded in 2019 when the expenditure for international travel by Indians stood at US$ 6.96 billion.

According to the reports, Indians this year have spent US$ 881 million on overseas travel in April, US$ 995 million in May, $1.04 billion in June, and US$ 1.02 billion in July.  During the first four months of FY23, the outward travel remittance exceeded what Indians spent on travel during the whole of FY20, which was US$ 3.24 billion. 

FY20 saw restrictions on travel due to the pandemic. However, the opening up of borders and resumption of international flight services, caused an uptick in outbound travel picked up from mid-2021, making the total outward remittance of Indians grow to a historic high of US$ 19.61 billion.

Indians have remitted a total of US$ 8.03 billion under LRS during the first four months of FY23, of which travel remittances accounted for 49%, followed by remittances for ‘maintenance of close relatives at 16%, overseas education at 12.6%, and gifts at 12.3%.

As per the reports, resident individuals, under the LRS, are allowed to remit up to US$ 250,000 each year for permissible current or capital account transactions, including international travel, maintenance of close relatives, medical treatment, remittances for overseas education, purchase of investment in equity/debt, gift or donation, and purchasing immovable properties among others.