Why India Wants to Send More Workers Abroad to Save the Rupee

The rupee has slid past the 96 mark against the US dollar, and the pressure is building. Rising oil prices are threatening to push the current account deficit to 2.3% of GDP by FY27, up sharply from 0.9% in FY26, according to projections by HSBC. As policymakers look for ways to defend the currency, the answer of sending more people abroad is emerging.

India is considering a policy push to accelerate the overseas deployment of skilled workers as part of a broader strategy to support the rupee and strengthen remittance inflows.

What the Government Is Doing

The Ministry of External Affairs has directed the Ministry of Skill Development and Entrepreneurship to fast-track the overseas deployment of Indian workers to Israel, the Economic Times reported. The mobilisation is being carried out through government-to-government channels to meet labour demand in Israel's construction and caregiving sectors.

Following the signing of three bilateral implementation protocols in February, Israel has committed to absorbing 50,000 Indian workers over the next five years across sectors including commerce, manufacturing, services and hospitality. Israel's Population and Immigration Authority data shows 48,881 Indian nationals are already in the country, including 6,700 construction workers and 50 caregivers deployed through official government channels.

India's broader ambition goes beyond Israel. The government is also working on the Overseas Mobility Bill, intended to replace the outdated Emigration Act of 1983. The proposed legislation aims to build a modern framework that ensures safe placements, fair treatment and structured reintegration for Indian workers returning home.

Why Remittances Matter

This is where the macroeconomic logic kicks in. In FY25, India received $135.4 billion in remittances, making it the world's largest remittance recipient for the year, according to the Economic Survey 2025-26. India's gross foreign direct investment inflows in the same period stood at approximately $47 billion, meaning Indian workers abroad sent home nearly three times more money than foreign investors brought in.

Remittances also behave differently from other forms of foreign capital. Unlike foreign institutional investment, which can exit rapidly during global market stress, remittances tend to remain stable and even rise during downturns. A weaker rupee adds another incentive, it means every dollar sent home buys more rupees, making transfers more attractive for Indians working abroad.

The push comes at a time when traditional Western destinations for Indian migrants, the US, Canada, UK and Western Europe, are tightening their immigration frameworks. Rising nativism and restrictive visa policies are forcing a rethink of where Indian workers go.

This is coinciding with growing demand from aging, capital-rich economies that are short on labour, particularly in West Asia. India's government is treating this shift not as a setback but as an opportunity to redirect its demographic dividend toward new and willing economic partners.