Asia remittances Spillovers from a Gulf shock

Research evidence excerpt

Asia remittances Spillovers from a Gulf shock

26 May 2026

Asia remittances EconomicsAsia

Spillovers from a Gulf shock

◆ Hormuz disruption hits GCC non-oil sectors, weakening

Asian migrant hiring and risking declines in remittances InesEconomist,Lam Asia

The Hongkong and Shanghai Banking Corporation Limited

◆ Bangladesh and Sri Lanka face highest vulnerability, with ines.y.k.lam@hsbc.com.hk

heavy GCC concentration and high remittance reliance +852 22887131

Frederic Neumann

◆ India, the Philippines and Indonesia have a diversified migrant Chief Asia Economist, Co-head Global Research Asia

base, supporting resilience despite near-term income pressures fredericneumann@hsbc.com.hk

+852 2822 4556

Abanti Bhaumik

When the remittance tide turns Associate

Bangalore

Damage to physical infrastructure and prolonged disruption to trade and logistics are

set to weigh heavily on Gulf economic activity over the near term. As infrastructure

and real estate projects face pauses or delays and tourism activity weakens, demand

for foreign labour is likely to ease, posing risks for Asia’s major migrant-sending

economies: India, Bangladesh, Sri Lanka, the Philippines and Indonesia.

Exposure varies. Bangladesh and Sri Lanka are most vulnerable, given heavy Gulf

Cooperation Council (GCC) concentration and high remittance reliance relative to their

economic size. India receives very large remittance inflows in absolute terms but is

more resilient, given the size of its economy. The Philippines is more remittance-

reliant relative to GDP but benefits from a diversified migrant destination base.

Early indicators suggest that the shock may already be feeding through: Bangladesh’s

overseas worker deployment fell 57.5% y-o-y in March, while the Philippines’ remittance