29pc of remittance goes to productive uses: BRAC

At least 29 percent of the country's remittance is used for investment purposes, a finding that dispels misconceptions that migrant workers' earnings typically go to non-productive uses.
On average, an overseas migrant invests $609 of his/her yearly remittance earning of $2,105, a recent survey by BRAC found.
However, the study found that food, house construction and ceremonies still took up majority of the expenditure: food accounted for about 37 percent, house construction and repair 12 percent and social and religious ceremonies 8 percent.
The findings of the study -- on the significance of remittance in poverty alleviation and livelihood development in Bangladesh -- were presented yesterday by Mahabub Hossain, executive director of BRAC, at a workshop held at the BRAC Centre Inn.
Nearly 8 million Bangladeshis now temporarily work abroad, and in 2012, they sent in $14 billion in remittances, which is 11 percent of the gross national income. The survey found that one in seven rural households now have a close relative working abroad.
“Remittance has a substantial positive effect on the income of households with overseas migrants. In fact, it accounts for three-fourths of the households' income,” said Hossain.
Many scholars said the country's remittance earnings do not benefit the economy as they are directed to the unproductive sector, said Zahid Hussain, lead economist of the World Bank.
“This study has proved it wrong,” he said, terming it to be “a good sign” that overseas workers are now investing in business activities.
“Even if the entire amount is used for consumption purposes, the economy still benefits -- significantly.”
Hussain, however, said that the remittance earning by each worker is still low in comparison to other countries.
“One reason why the inward remittance figures are higher than before is because overseas migrant workers are progressively opting for formal channels to send in their money,” said Anisul Islam Mahmud, chairman of the parliamentary standing committee on the expatriates welfare and overseas employment.
Migrant workers generally buy land on remittance income due to unavailability of secure investment in the country, according to Islam. “They consider land as a safe and secure investment.”
The country is expected to receive around $15 billion of inward remittance this fiscal year, according to Dasgupta Asim Kumar, executive director of Bangladesh Bank.
He, however, said the actual remittance figure would be higher by 70 percent if the unofficial channels are taken into consideration.
“Overseas migration can now be called a success story for Bangladesh,” said Zafar Sobhan, editor of Dhaka Tribune.
He urged the government to take measures so that workers can go abroad at minimal costs and are not abused abroad.
However, the survey also said that remittance has a negative effect on the economy: only 69 percent of the adult males in households with overseas migrants participated in economic activities, compared to 87 percent in households with no migrant members.