KARACHI: Remittances from overseas Pakistanis jumped 12.5 per cent to $9.028 billion in the first five months of this fiscal year, from $8.021bn in same period last year, reported the State Bank of Pakistan (SBP) on Pakistan.
However, on a monthly basis, remittances plunged by 19.6pc to $1.609bn in November, as compared to $2bn earlier in October.
Bankers believe the tightening of illegal money transactions are producing positive results as most of the inflows are now coming through banking channels.
The SBP recently took strict measures to curb money laundering and illegal transactions like Hundi and Hawala. Currency experts said these days illegal transactions are becoming impossible.
According to the data, highest inflows came from Saudi Arabia at $2.152bn during 5MFY19 — showing a growth of 2.5pc –– while United Arab Emirates closely followed, with remittances increasing 10.6pc to $1.95bn. United States came in third, with inflows during the period surging by 33.2pc to $1.393bn
Malaysia has also emerged as a new significant destination for remittances to Pakistan. During 5MFY19, inflows crossed half a billion dollars for the first time as they soared by 53.3pc to $616m, from $401.78m in same period last year. Meanwhile, remittances from the United Kingdom grew 14.2pc to $1.286bn.
On the other hand, remittances from Gulf Cooperation Council countries fell by 6.8pc to $876m while those from the European Union edged up 2pc to $265m during this period.
During November, however, there was a decrease in inflows as remittances from Saudi Arabia fell to $395m as against $494m in October, US $255m from $308m, UK $228m from $298m and UAE $343m from $412m.
The new government has shown intention to crack down on illegal transactions of money including remittances, where the open market offers higher returns for dollar or other currencies compared to the banking rates.
Currently, the greenback has almost the same price in both interbank and open markets.
Moreover, the government has been planning incentives for overseas Pakistanis who send remittances.
At the same time, it is trying to export about 100,000 Pakistani workers to Qatar, which has promised to provide jobs. This could boost remittances which now stand close to the total export proceeds of the country (which have fallen by around $5bn in the last five years).
Published in Dawn, December 11th, 2018