Indians sharply cut their spending on overseas travel in March, with remittances for outbound trips falling by more than $212 million from the previous month, according to Reserve Bank of India data.
The decline in outbound travel expenditure came amid rising oil prices linked to the conflict in the Middle East and continued pressure on the rupee, even as travel remains the largest single component of outward remittances under the Liberalized Remittance Scheme (LRS).In March, travel-related remittances fell to $1.09 billion from $1.3 billion in February and $1.65 billion in January. The decline came at a time when conflict in West Asia pushed oil prices higher and weakened the rupee to record levels.
Amid this situation, Prime Minister Narendra Modi urged citizens to reduce travel abroad and adopt measures such as car sharing. Lower spending on foreign travel could reduce foreign exchange outflows and help ease pressure on the rupee.According to Reserve Bank of India data on outward remittances by resident individuals, travel continued to represent the largest share of funds sent abroad under the Mortgage Act in March. Total transfers during the month amounted to $2.59 billion.
The Reserve Bank of India tracks external spending across categories including travel, studies abroad, maintaining close relatives, foreign investments and property purchases. Under the LRS framework, resident individuals, including minors, can transfer up to $250,000 in a financial year for permitted current or capital account transactions.Within the travel sector, the largest item remained the “other travel” category, which covers holiday spending and international credit card settlements.
Indians spent $623.05 million under this category in March, representing about 57% of the total travel-related transfers during the month.Expenses associated with educational travel, including hostel payments and fees, amounted to $450.16 million. Business travel, Hajj and medical treatment abroad together accounted for $21.39 million.The data also showed a rise in remittances intended to support close relatives abroad.
These remittances increased to $389.78 million in March from $266.18 million in February.At the same time, spending fell under the “studies abroad” category. This category includes payments made for educational services that are accessed remotely without traveling abroad, such as correspondence courses. Transfers under this heading amounted to $151.71 million in March, compared to $175.68 million in February and $267.42 million in January.For FY 2024-25, Indians remitted a total of $29.56 billion under the LRS. Travel represented the largest portion of this amount, worth $16.96 billion.RBI figures also showed that Indians’ investments in equities and external debt instruments rose significantly to $440.22 million in March from $265.99 million in February.Meanwhile, outward remittances for purchases of immovable property abroad fell to $38.68 million in March, down from $51.36 million in the previous month.
