The overseas Pakistanis have sent the remittances that fell by 5 percent year-on-year to $2.144 billion in January as stated by the State Bank of Pakistan (SBP) on Friday.
According to the data showed by SBP, the remittances showed a fall of $376 million or 15 percent on monthly basis. The workers’ remittances, however, continued above the $2 billion-mark for the 20th sequential month.
If the decreasing trend continues in the remaining months of this current fiscal year, it could cause severe problems for the financial managers as the government relies heavily on remittances, which are much greater than the country’s total export earnings.
In July-January 2021-22, the remittances increased at a much slower rate of 9.1 percent to $17.951 billion when the growth was noted at 24 percent over the previous period.
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Moreover, the government judges over $30 billion inflows from the foreign Pakistanis at the end of FY22, which will benefit the country link the broadening current account deficit already traversing $9 billion in the July-December period of the current fiscal year.
However, Finance Minister Shaukat Tarin said that the country is confined to pay back the whole $3 billion payment made by Saudi Arabia in an SBP account at 4 percent, which could produce more problems for Pakistan.
The facts exhibit that the greatest amount of $4.579 billion, a rise of only 1.5 percent, was received from Saudi Arabia. Likewise in FY21, the remittances from the kingdom increased by 21.6 percent.
Moreover, the second largest inflow was from the United Arab Emirates in spite of negative development of 1.8 percent to $3.382 billion in 7MFY22 as compared to $3.443 billion in the similar period of FY21 when it was grown by 6.3 percent.
Meanwhile, other GCC states remitted $2.061 billion having a growth of 9.3 percent when compared to the same period of the preceding fiscal year.
Pakistan’s other two main sources of remittances are the United States and the United Kingdom. The SBP report shows that the inflows from these two countries were $2.467 billion and $1.701 billion along with an increase of 13.2 percent and 21 percent respectively. Likewise in FY21, the remittances from the UK and the US increased by 51 percent and 45 percent.
