Relationship Between Remittances and Hdi in Saarc Countries

Abstract

In order to provide an empirical insight into the role of international migrant remittance inflows in low-income countries and developing countries, this paper examines the long-run impact of international migrant remittance inflows on overall human development index in SAARC countries. The fixed-effects annual panel data estimation procedure for the period, 1990 to 2018, was used for the empirical analysis. The paper suggests that, contrary to the apprehension of the remittance-pessimistic developmental school, international migrant remittance inflows have a significant positive impact on overall human development in SAARC countries. This evidence suggests that the essential role of international migrant remittance inflows on the socioeconomic development of SAARC region should not be undervalued in formulating any contemporary economic development strategy for the sub-region. Therefore, governments of this sub region should pursue remittance-attracting policy as one of the macroeconomic policies to stimulate Human Development Index.

Key Words: HDI, Remittances, SAARC, Fixed-effects