Introduction

Indian immigrants have made a significant impact on the global economy, particularly in the Americas. According to recent studies, Indians have been at the forefront of establishing high-valued startups in the U.S., and even small and medium enterprises (SMEs) have been instrumental in driving certain sectors. This article delves into the extent to which Indian immigrants contribute to the American economy and how they send money back to India, if at all.

Indian Entrepreneurs Driving Innovation in the U.S.

Indian immigrants are leading the way in technological innovation and startup culture. A recent study by NFAP reveals that immigrants, and especially Indians, have founded more than half of all U.S.-based unicorns (start-ups valued at over 1 billion dollars). Indians are the highest earners among immigrants, often buying real estate and becoming a driving force behind the local economies in which they reside. The top 500 unicorn founders in the U.S. have 39% Indian founders.

Remittances: A Fraction of Their Contribution

While some Indians do send remittances back to India, the amount is negligible when compared to their overall contributions to the American economy. The “earn, save, invest” mentality prevails among middle-class Indians who don’t settle down in the U.S. These individuals send back only modest sums, with many aspiring to build houses in their home towns, fulfill personal ambitions, or invest in other ventures in India. Such modest remittances are a small fraction of the overall economic impact they have in America.

The System of Remittances

For those who do send remittances, the process has evolved significantly. Many immigrants use a system where they transport crates filled with currency, which are then distributed to deserving individuals through local agents, who charge just a small fee. This system, despite its simplicity, involves paying for an attorney, customs, and courier services. Recipients have to bank the money in their local savings account, and agents handle the logistics to ensure delivery. The process, while simple, ensures that remittances are likely aimed at supporting specific needs or aspirations.

Brain Drain vs. Benefit to India

Interestingly, the remittances sent back to India, while significant for those receiving them, are just a small part of the broader impact that Indian immigrants have on the Indian economy. The knowledge and expertise gained in the U.S. contribute to India’s ‘brain drain,’ which is ultimately beneficial as these individuals bring back innovative ideas, technologies, and business practices that help bolster the Indian economy and corporations.

Conclusion

While it is true that some Indian immigrants do send money back to India, the overall impact of their contributions to the American economy far outweighs the remittances sent. These contributions help drive local economies, fuel innovation, and enhance the overall economic landscape. When considering the multifaceted impact of Indian immigrants, the concept of remittances becomes a minor aspect compared to the direct and indirect benefits they bring to the U.S.