Foreign Labor Migration and the Remittance Economy of Nepal

Official statistics seriously underestimate the number of Nepali migrant workers abroad and both the volume and value of remittances flowing back into Nepal from those workers. Original research by the authors suggests that many migrant workers abroad are working illegally and unofficially, and that the bulk of remittances also flow back into Nepal informally and illegally. The scale of remittances, consequently, is at least ten times greater than official estimates indicate (equal to 13 percent of GDP) and quite possibly twenty times greater (equal to 25 percent of GDP). This indicates the need for a thorough reconsideration of Nepal's balance of payments. The authors illustrate how remittances flow back into Nepal unevenly, contributing to growing inequalities, both between regions and between social classes.