KARACHI: In line with market expectations, Pakistan received higher remittance inflows worth $2.03 billion from overseas Pakistanis in the first month – July – of the current fiscal year 2019-20 ahead of Eidul Azha.
The inflows were almost 3% higher than the $1.98 billion received in the same month last year. July was also followed by Eidul Azha in the preceding year.
“Comparatively better remittances were received ahead of Eidul Azha,” said the head of Remittances Department at a state-owned bank while talking to The Express Tribune on Friday.
“We have a trend according to which the country receives comparatively higher remittances before festivals,” he said. Eidul Azha will fall on August 12.
Pakistan has a trend of receiving the largest amount of remittances in a year in Ramazan. Then a dip is generally observed in the next month, which is followed by better remittances ahead of Eidul Azha.
The remittances data indicated that the increase was not only because of the Eid, but there was other reason as well.
“Higher remittances from Saudi Arabia, UAE, US, UK and other European nations suggest more Pakistanis have been finding jobs in these countries and that the financial crisis, mostly in the Gulf states where majority of the Pakistanis live, is over,” he said.
“The government is also making background efforts that more and more people who go abroad find jobs there. This will help attract better remittances in the months to come,” he said.
“Though it is too early to say, the country is expected to see an average 11% growth in remittances (to around $24 billion) in the current fiscal year.”
The remittances increased 10% to $21.84 billion in the preceding fiscal year 2018-19 compared to $19.91 billion in the previous fiscal year, according to the central bank.
A massive 32% depreciation of the rupee to Rs160.05 to the US dollar in the previous fiscal year, improvement in financial management in Gulf countries and crackdown on illegal money transfers – Hundi and Hawala – prompted the overseas Pakistanis to send higher remittances through legal channels including banks during the year.
According to a central bank report, over 10 million Pakistanis are residing abroad. Remittances remain one of the leading sources of the country’s foreign income. They are being utilised to finance the deficit in import payments and partially pay off foreign debt.
Country-wise details for July 2019 showed that inflows from Saudi Arabia amounted to $470.95 million compared with $437.48 million in July 2018.
Pakistanis residing in the UAE sent $427.33 million compared to $446.25 million. Remittances from the US amounted to $332.37 million compared to $291.87 million whereas inflows from the UK amounted to $299.27 million compared to $298.51 million.
Remittances received from Malaysia, Norway, Switzerland, Australia, Canada, Japan and other countries during July 2019 amounted to $253.01 million against $243.35 million in July 2018.
Published in The Express Tribune, August 10th, 2019.