KARACHI: Remittances from overseas Pakistani workers surged 35 per cent in the first four months of the current fiscal year, State Bank of Pakistan (SBP) data showed on Friday.

The country received $11.8 billion during July-October FY25 compared to $8.8bn in the same period last year, an increase of 34.7pc. Inflows in October rose year-on-year 24pc and month-on-month 6.7pc to $3.05bn.

The country is struggling to arrange $26bn to meet external debt repayment obligations in the current fiscal year.

The higher inflows of remittances usually used to meet the trade deficit.

With a meagre $98 million current account deficit, this inflow would help easing pressure on external debt servicing front.

Recently, the governor SBP expressed the hope that the country would be able to secure $14bn debt rollover while arrangements were being made for $6bn.

Financial experts believe if this bullish trend persists, the country could receive unprecedented remittances in FY25, breaking the $32bn record hit in FY22. The country received about $30bn in remittances in FY24.

During the calendar year 2023, one million Pakistanis — skilled and non-skilled — went abroad, suggesting inflows would be higher in future. According to the data, the highest inflows came from Saudi Arabia but the highest growth was noted in from UAE.

The State Bank reported the inflows from Saudi Arabia and UAE were $2.923bn and $2.33bn during July-October, showing a growth of 37pc and 55.8pc, respectively.

The inflows from the US and the UK were $1.199bn and $1.771bn, up 14pc and 38.7pc. Remittances from GCC states and EU countries rose 19.3pc and 27pc to $1.181bn and $1.451bn.

The rising inflows would also boost SBP’s forex holdings. The central bank is a regular buyer of dollars from the interbank currency market. It purchased $1.2bn from the market in June and July.

Published in Dawn, November 9th, 2024