Mumbai: Total outward remittances under the Liberalized Remittance Scheme (LRS) saw a contraction in FY2026, falling by nearly 2% to $29 billion from $29.6 billion recorded in FY2025. This downward trajectory highlights that visa restrictions are impacting foreign education spending, which fell 20.9% to $2.3 billion from $2.9 billion, along with a 3.1% decline in international travel. Despite a slight decline in percentage, travel remains the single largest comprehensive expenditure item under the LRS, accounting for $16.4 billion in FY26.In sharp contrast to the decline in lifestyle expenses, asset-backed outflows grew aggressively, even though they grew from a relatively low base compared to consumption categories. Purchasing of real estate abroad emerged as the fastest growing segment, growing 63.8% to $528.7 million from $322.8 million the previous year. Similarly, investment in foreign equity and debt securities saw a strong growth of 56.1%, from $1.7 billion in FY25 to $2.7 billion in FY26, highlighting a major shift towards global wealth diversification among domestic retail capital.March 2026 reversed broad quarterly trends by displaying a different sequence of monthly changes, which were strongly influenced by sudden geopolitical shocks. Total monthly remittances in March were $2.6 billion, compared to $2.3 billion in February – a gradual turnaround in dollar flows that had been heavily disrupted below the surface due to a sharp decline in international travel.Following the outbreak of the US–Iran war in late February and the subsequent closure of airspace across West Asia, travel-related LRS remittances declined from $1.3 billion in February to $1 billion in March.