Overseas Pakistanis send $14.8 billion in remittances in five months

ISLAMABAD: Remittances from overseas Pakistanis rose sharply to $14.8 billion in the first five months of the ongoing fiscal year, reflecting a 33.6 per cent increase from the same period last year, according to the State Bank of Pakistan (SBP).

This growth is attributed to economic recovery supported by International Monetary Fund (IMF) loans, a stable rupee, incentives from banks and money exchangers along with a rise in the number of skilled workers emigrating from Pakistan. In the last three years, about one million skilled workers have moved abroad, boosting remittance inflows.

In November, remittances were recorded at $2.9 billion, marking a 29.1 per cent year-on-year increase. However, there was a slight 5 per cent decline from the previous month. Monthly remittance inflows have averaged $2.9 billion over the period.

The policies of central bank, particularly those aimed at reducing illegal foreign exchange activities, have played a major role in the rise of official remittance flows. Additionally, declining global inflation has encouraged Pakistani migrants to send more money home.

“Remittances are growing steadily year-on-year, driven by a stable rupee, curbed hawala and hundi practices, and bank incentives,” said Awais Ashraf, Director of Research at AKD Securities Limited.

Remittances are crucial for Pakistan’s economy, as they help strengthen foreign exchange reserves and support balance of payments.

During the first four months of the current financial year, the country recorded a current account surplus of $218 million, compared to a deficit of $1.528 billion in the same period last year. The central bank’s foreign exchange reserves stood at $12 billion by November.

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