Overseas Pakistanis’ remittances have increased to a record-breaking Rs. 31.2 billion in the 2021-22 financial year, which is a 6 percent increase from the $29.4 billion reported in the previous financial year. These funds are essential to support Pakistan’s economy.
The remittances from Saudi Arabia stood at the highest level of $7.74 billion, with a slight increase from last year. Those from the UAE were recorded at $5.8 billion in FY22 as compared to $6.1 billion reported in FY21. The remittances from the Gulf countries (Bahrain, Qatar, Kuwait, and Oman) were $3.6 billion in FY22 as compared to the $3.3 billion reported in FY21.
The inflow of remittances from EU countries was $3.3 billion in FY22, a significant increase from the $2.7 billion reported in FY21.
The State Bank of Pakistan (SBP) has reported that workers’ remittances have reached a new high in the fiscal year 2022.
As anticipated, the remittances in FY22 have increased by six percent to $31.2 billion. In June alone, the remittances rose by 18 percent to $2.8 billion as compared to the previous month, and by two percent as compared to the same period last year.
The remittances rose sharply in June this year, increasing by 18.4 percent on a month-on-month (MoM) basis, and 1.7 percent on a year-on-year (YoY) basis. They were mainly sourced from Saudi Arabia ($666 million), the UAE ($495 million), the UK ($455 million), and the USA ($285 million). Cumulatively, the remittances rose to a record $31.2 billion in FY22, increasing by 6.1 percent compared to FY21.
The inflows were increased due to multiple measures taken by the government and the banking regulator. These steps included the implementation of the Roshan Digital Account, providing incentives to overseas Pakistanis (Sohni Dahrti Program), banks, and exchange companies to encourage higher collections of remittances, and facilitating expatriate Pakistanis living in different countries.
The inflow of remittances has played a very important role in offsetting the impact of higher imports on the balance of payments. This is one of the solid components of macroeconomic indicators which consistently bodes positively for the country’s economy.