ISLAMABAD: The State Bank of Pakistan (SBP) has categorically rejected a report that suggests an outflow of $4.9 billion from Pakistan to India as remittances and has termed it contrary to facts.
The data of balance of payments showed that $116,000 worth of worker remittances flew from Pakistan to India in FY16 and inflows from India to Pakistan stood at $329,000, the SBP said in a statement on Wednesday.
In the year, Pakistan’s exports to India were valued at $425 million while imports from India amounted to $1,415 million.
The SBP pointed out that the outflow of $4.9 billion was cited in the Migration and Remittances Fact Book 2016, prepared by the Global Knowledge Partnership on Migration and Development.
“It must be noted that the Fact Book data on bilateral remittance flows suggests estimates (not actual flows), which are based on a number of assumptions on migrant stock, per worker income, etc,” it said.
The methodology used to calculate these numbers is based on a World Bank’s working paper prepared by Ratha, Dilip and William Shaw.
The methodology had serious issues, particularly in the case of Pakistan, as acknowledged by the authors themselves, stating “interpreting the meaning of migrant stocks also presents some difficulties,” the SBP added.
The central bank said Pakistanis in India and Russians in Ukraine became migrants following partition of the original country. “Thus, the study is clearly flawed as the migrants at the time of India-Pakistan partition in 1947 had become citizens of Pakistan.”
Published in The Express Tribune, September 22nd, 2016.