KARACHI, June 19: Half of Pakistan’s home remittances — or the money sent back home by overseas Pakistanis — come from the US and the UAE combined.

According to the data compiled by SBP from banks handling home remittances, Pakistan received $1.9 billion remittances from the US and the UAE in 11 months to May 2003. Total remittances coming from across the globe during this period stood at $3.8 billion.

Between July 2002 and May 2003 the country attracted $1.130 billion from overseas Pakistanis living in the US and $770 million from those residing in the UAE. In a year-ago period inward remittances from the US stood at $666 million and those from the UAE at $423 million.

Senior bankers say since most of 3.7 million Pakistanis living abroad are stationed in the US and their share should naturally be high in home remittances. But they say there is another reason for Pakistan to attract increased remittances from the USA and the UAE. “And that is...these countries have introduced stiffer checks on banking business to root out money laundering that fuels international terrorism,” said a seasoned foreign banker.

Besides the US and the UAE are very large international and regional currency markets respectively and people living there have a better sense of employing surplus funds than others who live elsewhere. “Pakistanis living in the US and the UAE know how to put their money to best use...and they think Pakistan is now a better place for their money both in terms of safety and return,” said another banker.

Besides making investment in the equity markets directly as well as through their friends and relatives in Pakistan, the expat Pakistanis are also investing huge funds in real estate. Estate brokers say a lot of money has poured in the property market in the recent past giving rise to real estate prices.

SBP data shows that Saudi Arabia is the third largest source of home remittances after the USA and the UAE. In 11 months to May 2003 Pakistanis living there sent back home $527 million up from $339 million a year ago.

The current fiscal year may close with the home remittances totalling $4.2 billion equal to 40 per cent of export earnings. Senior bankers say better marketing of the facilities announced for overseas Pakistanis sending money back home can raise the figure further adding that from the UAE alone Pakistan can get a billion dollar remittances every year. The same is true for Saudi Arabia. Bankers say if the recently exchange companies are encouraged they can play a vital role in this regard. These companies have so far not been very aggressive in attracting home remittances because of some operational bottlenecks that the SBP is yet to remove.