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Remittances drop to $17.5bn

Updated June 10, 2017
Pakistan received remittances of $1.59bn per month in July-May. But Ramazan-related inflows in June can possibly be double the average monthly remittances, pushing the annual figure close to $19.9bn.—White Star
Pakistan received remittances of $1.59bn per month in July-May. But Ramazan-related inflows in June can possibly be double the average monthly remittances, pushing the annual figure close to $19.9bn.—White Star

KARACHI: Remittances sent by overseas Pakistanis slightly decreased in July-May to $17.46 billion, the State Bank of Pakistan (SBP) reported on Friday.

Remittances during the first 11 months of the current fiscal year were down 2.13 per cent or $380 million from a year ago.

The latest remittance figure does not reflect the usually high inflows that are recorded before and during Ramazan as overseas Pakistanis send charity, donations and Zakat every year. Analysts believe Ramazan-related inflows will be reflected in June figures.

Exchange companies said remittances increased in Ramazan. But they don’t have data to back up their claim about increased inflows in the holy month.

Internationally known charity organisations in Pakistan attract hundreds of millions of dollars during Ramazan as donations and Zakat.

Details show remittances declined from all major sources, except the European Union.

The monthly average inflow this year has been $1,587m. With only one month left before the end of 2016-17, total remittances in the current fiscal year are expected to be around $19bn. However, Ramzan-related inflows can push the annual figure close to the total of the preceding year. Inflows in Ramazan can possibly be double the usual monthly remittances.

Inflows posted the growth of 6.4pc in 2015-16 as they touched the record high of $19.9bn. Remittances in the last fiscal year were higher than their annual target of $19bn.

After a decade of consistent growth, remittances started falling year-on-year mainly on account of a drop in global oil prices. It affected the Gulf countries that employ millions of Pakistanis. Pakistan receives about 65pc of its total remittances from the Middle East.

The highest inflows were from Saudi Arabia during the 11 months. Pakistan received $5.03bn from the kingdom, down 6.57pc from a year ago.

Remittances from the United States and United Kingdom also fell 3.22pc and 8.13pc, respectively. Inflows from the United States were $2.18bn and $2.1bn from the United Kingdom in July-May.

Remittances from the United Arab Emirates amounted to $3.9bn, registering a decline of 0.88pc year-on-year.

Remittances from the European Union, which was the only region from which inflows rose in July-May, amounted to $425m, up 15pc year-on-year.

Inflows from member-countries of the Gulf Cooperation Council, except Saudi Arabia and United Arab Emirates, declined 4.5pc to $2.09bn.

Published in Dawn, June 10th, 2017