Overseas Pakistanis sent remittances amounting to $14.1 billion in July-March, up 4.1% from a year ago, according to data released by the State Bank of Pakistan (SBP) on Tuesday.
Remittances amounted to almost $13.6 billion in the same nine months of the preceding fiscal year. They amounted to $1.4 billion in March alone, which is 3.1% less than the remittances received in the preceding month, SBP data shows.
Pakistanis based in foreign countries sent home $18.4 billion in 2014-15, which shows a year-on-year increase of 16.5%. The slowdown in the pace of remittances’ growth in 2015-16 so far is because of two main reasons: “very low inflation” across advanced economies and a slow global economic recovery, according to the central bank’s economists.
Nonetheless, Pakistan has posted a “relatively decent growth” among the top 20 remittance-receiving countries: only Pakistan and Indonesia recorded year-on-year growth of more than 10% in remittances in the last calendar year.
Inflows from Saudi Arabia were the largest source of remittances in Jul-Mar. They amounted to $4.3 billion in the nine months, up 7.2% from the corresponding period of the last year.
Remittances received in Jul-Mar from the United Arab Emirates (UAE) increased 3.8% to $3.1 billion on a year-on-year basis. Inflows from the UAE had registered the largest increase (26.1%) from any major remittance-sending country in 2014-15, SBP data shows.
In the first nine months of the current fiscal year, remittances from Dubai have surged 31.3% year on year. But the figure for overall inflows from the UAE so far has remained subdued because of a 29% annual decline in remittances from Abu Dhabi over the same period.
Remittances from the United States and the United Kingdom remained $1.8 billion and $1.7 billion, respectively, in Jul-Mar. The year-on-year change in remittances from the US and the UK has been -6.2% and 0.6%, respectively.
According to a separate SBP report issued recently, it believes that US workers of Pakistani origin are holding on to their savings within the United States instead of remitting them back home. They are withholding that portion of their savings that they would otherwise send their families for “investment purposes,” the SBP said.
Remittances from Gulf Cooperation Council (GCC) countries, excluding Saudi Arabia and the UAE, clocked up at $1.7 billion in Jul-Mar, which is 8.3% higher than the remittances received from these countries in the same months of the preceding fiscal year.
Remittances from Oman in Jul-Mar equalled $566.4 million while those from Kuwait, Bahrain and Qatar amounted to $544 million, $326.7 million and $274.4 million, respectively.
This means the overall share of the oil-rich GCC countries in Pakistan’s remittances is over 64.8%. Analysts fear remittances from these countries may dwindle going forward, as their governments begin to scale back infrastructure spending in the wake of a sharp fall in global oil prices.
Remittances received from Norway, Switzerland, Australia, Canada, Japan and other countries in March amounted to $120.92 million as opposed to $91.51 million received in the same month of 2015.
Published in The Express Tribune, April 13th, 2016.