Migrants’ Remittances & Development: A Critical Appraisal

Remittances- or the money international migrants send home- has been touted as an alternative source of development fund for many origin countries of migrants in the Third World. Over last three decades, the belief in ‘developmentalism’ gave way to ‘globalization’ with replacing the nation state by global free market as the most efficient driver of economic growth in the developing world. Moreover, the flows of Official Development Aid (ODA) and Foreign Direct Investment (FDI) in the developing countries consistently declined. In this circumstance, the World Bank and other international organizations recognize migrants’ remittances as an alternative to the ODA and FDI due to its sheer size, which is more than three folds of ODA and FDI and its continuous growth. After three decades of optimism about the developmental outcomes of migrants’ remittances, success stories of economic growth by utilizing remittances in migrants’ origin countries are extremely rare, if not nonexistent. By placing the migrants and their remittances in the larger context of ‘Third World Development’, this paper explores the relationship between development and migrants’ remittances with a particular emphasis on remittances utilization. The main objective of this paper is to critically examine the developmental potentials of migrants’ remittances and the role of the migrants in bringing about developmental outcomes. It also raises few theoretical questions regarding structure and agency to highlight plausible reasons of the absence of success cases of development by migrants’ remittances. Finally, it concludes by calling for assessing the idea of development through migrants’ remittances with sound theoretical frameworks and rigorous empirical analysis.