The Economic Coordination Committee (ECC) of the cabinet on Wednesday approved a subsidy of Rs13.1 billion for retaining the inflows of foreign remittances at their existing level — $29.4 billion annually — amid ambiguity over an incremental increase in the amount.
The government has also made the expensive Roshan Digital Accounts (RDAs) inflows part of the subsidy programme.
The money remitted by overseas Pakistanis through RDAs would stay in the bank accounts — instead of being invested in the government debt at up to 7% interest rate – and would be entitled to the subsidies.
The ECC approved the National Remittances Loyalty Programme (NRLP), according to a press statement issued by the finance ministry. The statement mentioned nothing on the cost of the programme, value for money and its sustainability.
The finance ministry will have to give a supplementary budget to pay the subsidies as the plan has been made after the approval of the budget by parliament.
The estimated financial impact of the programme is Rs13.1 billion, which is based on the assumption that 25% remitters who sent money in the last fiscal year would be registered under the scheme, according to a summary of the finance ministry.