Her husband had sent the money through money transfer agent. After she received the money, she had already been making plans for the upcoming festivities. Other women, who had queued up at the money transfer agent´s office to receive the money sent by their relatives from abroad expressed similar joy. [break]
But this also makes it clear that the remittances sent by migrant workers abroad are being spent on household needs instead of being invested in business.
“People are not interested in investing the remittance money in productive sectors. Rather, they splurge on food, clothes and other luxury items,” said a social worker, Rajendra Kafle. “To make matters worse, people do not even hesitate to borrow money to purchase these items as they are certain their relatives would send them money to pay off loans,” added Kafle.
Some locals have built new houses and bought land but many others splurge the money on unnecessary items. Kafle said a huge chunk of the money received in remittances is spent on alcohol.
“The remittances could have been used to set up businesses. But this is not the case in Panchthar district,” said Magal Bega, coordinator at HUCODEC Nepal, an NGO.
“Most of the locals now own mobile phones and other high tech gadgets,” added Bega.
According to Dhurba Baskota, manager at the Phidim branch of Clean Energy Bank, the district receives around Rs 60 to Rs 80 million in remittances every month.
According to the latest report of World Bank, Nepal is the sixth largest recipient of remittances. Nepal receives over Rs 400 billion every year in remittances.
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