KARACHI:
The State Bank of Pakistan (SBP) has announced that remittances sent home by overseas Pakistani workers crossed the $11 billion mark for the first time in the country’s history during the last fiscal year (2010-11).
Expatriate workers remitted a record amount of $11.20 billion during the year, an impressive growth of 26 per cent or $2.29 billion, compared with $8.90 billion received in the previous fiscal year, SBP said. The target for remittances in the Annual Plan for FY11 was around $9 billion. Giving one of the reasons for the sharp increase in remittances, the central bank said a joint move called Pakistan Remittance Initiative by SBP, the Ministry of Finance and the Ministry of Overseas Pakistanis had facilitated the flow of remittances into the country through formal channels.
An analyst said the narrowing of the difference between currency exchange rates of inter-bank and open markets and political instability in the Middle East over the last six months also contributed to the increase in remittances.
In June alone, remittances stood at $1.10 billion, the highest-ever amount sent home in a single month and the fourth month in a row when remittances crossed $1 billion. The figure was 31 per cent or $263.12 million higher from $841.44 million received in the same month in 2009-10.
The inflow of remittances in July-June 2010-11 from Saudi Arabia, UAE, USA, GCC countries (including Bahrain, Kuwait, Qatar and Oman), UK and EU countries amounted to $2.67 billion, $2.60 billion, $2.07 billion, $1.31 billion, $1.20 billion and $354.76 million respectively. Remittances from Norway, Switzerland, Australia, Canada, Japan and other countries amounted to $1 billion against $811.04 million received in the preceding year.
Monthly average of remittances for the year came to $933.41 million compared with $742.16 million in the previous year, showing an increase of 26 per cent.
Published in The Express Tribune, July 10th, 2011.
COMMENTS (12)
Comments are moderated and generally will be posted if they are on-topic and not abusive.
For more information, please see our Comments FAQ
Miles to go before we can sleep !! with mounting international borrowing, ever increasing US black mailing / delaying tactics to reimburse military expenditure, delay in interational materilization of international aid pledges and drying FDI, we will need more of such healthy remittances, growth in export (including services).
Expats, keep it coming.
@Nadeem Ahmed: Wish this money be spend on the Development and Real Growth of the Country
@Dude: I disagree - you got to understand the underlying concept of inflation and inflow of remittance; only if you might had mentioned positive correlation with economic growth, I would have agreed too but inflation is good subject to economic growth, whilst excessive without principle of growth is otherwise.
@Samir Your point is?
@Express times, all comments should be screened for mental soundness of senders before being published.
There are a lot of things working here including some money-laundering and some portfolio inflows because of rock-bottom interest rates in the US and Europe and better yields here and in Asia in general. No questions asked and no tax.
There is no harm if this is also driven by the rising cost of living in Pakistan. But that is not the whole story.
The government needs to come out with some sort of bond (like the India Shining Bond) to channel these inflows into productive investment. None of this inflow is being used productivily. If it is not for consumption it fuels the real estate market, or the stock market, or the buying of precious metals.
The is a Pakistan Investment Bond (PIB) but its existence and terms are not well known.
In the meantime, this helps finance the external accounts and keeps the IMF hounds at bay.
The people outside Pakistan can easily understand the importance of their country .It is very encouraging to see Pakistanis building confidence in their country despite challenges .I pray to Allah to make Pakistan a very very strong country .Long live Pakistan.
This is fooling the public, foreigners are parking their money in Pakistan just temporarily, this would not result in a good economy or help us in a substantial manner. The govt should stop taking billions in loans every few months from the SBP for inflation to stop. Why do you think Salim raza resigned?
I wish State Bank of Pakistan should have been little more precise in informing the common Pakistani that how much money was sent back to Pakistan by its politicians having big business outside who assumes it as their right to rule
Good news indeed!.... but only if these remittances are utilized for generating large scale economic activity in the country rather than ON being lavishly spent on luxury cars, 3G mobiles and related high profile lifestyle avenues leading to high inflationary trends. Government should take steps to channelize these remittances into attractive investment avenues to generate business activity at the back of more employment opportunities, productivity and social well-being.
So basically all the smart, hardworking Pakistanis are escaping Pakistan and working abroad while the Maulvi Imran Khan crowd stays back in Pakistan.
For the information of all readers, any economist would tell you that the inflow of remittances directly correlates to inflation. So yeah, this isnt exactly good news.
These billions are sent by hard working and patriotic Pakistanis and our corrupt rulers want to keep them away from country's affairs.