publications

Thinking Outside the Box: The Case for a Kerala Diaspora Development Bank

Balraj Kahlon

ABSTRACT

This study examines whether Kerala can effectively leverage its remittance inflows by
establishing a diaspora-supported development bank. Based on survey responses from Malayali
diaspora members and interviews with public‑finance experts, the report finds strong diaspora
willingness to financially support development initiatives, but challenges exist. There were
notable concerns about corruption and ineffective use of funds, but allowing for credible
diaspora oversight can measurably improve trust and participation. Experts highlight that state
borrowing limits and limited fiscal autonomy are barriers to implementing a diaspora‑backed
development bank. Overall, the findings suggest that while diaspora support exists, successful
implementation requires institutional trust‑building and reforms enabling greater state‑level
financial flexibility.