KARACHI: Remittances sent by workers during the first five months (July-November) of the current fiscal year FY25 jumped 34 per cent, but fell last month compared to the preceding month.

The latest data issued by the State Bank on Monday shows that remittances could reach the target of $35 billion set by the government for the current fiscal year.

According to the State Bank, overseas Pakistanis sent $14.76bn during July-Nov FY25 — an increase of 33.6pc over $11.05bn sent in the same period during the last fiscal year (FY24).

The sharp increase is clearly an outcome of the crackdown on illegal currency businesses like Hundi and Hawala.

Inflows jump 34pc to $14.7bn in 5MFY25

Finance Minister Mohammad Aurangzeb said in Karachi on Saturday that the government expects an inflow of about $35bn in the form of remittances during FY25.

Remittances totalled $30.25bn in FY24.

The month-wise breakdown of remittances shows a decrease of 4.55 per cent as it fell to $2.91bn last month from $3.05bn in October. The November inflow, however, showed a growth of 29.1 per cent year-on-year. During the first five months of the present financial year, the government received $3.7bn more in remittances than during the same period of last year. The rise in remittances stabilised the exchange rate and helped to keep a balance between supply and demand.

Highest inflow

Further analysis shows that the largest amount of $3.63bn was received from Saudi Arabia during July-Nov 25 — a growth of 36.5 per cent year-on-year.

The second highest inflow of $2.95bn was from the UAE. This head saw the highest growth of 54.6 per cent year-on-year. Inflows from the United Kingdom amounted to $2.18bn — the third largest sum.

The inflows from all destinations are showing a positive trend during the current fiscal year.

Other important inflows were $1.77bn from the EU countries. This head exceeded the inflows from the Gulf Cooperation Council (GCC) and the United States.

Some currency experts expressed concern over the changing political scenario in the Middle East as more than half of the remittances are received from this region.

Receipts from Saudi Arabia, the UAE and other GCC countries represented 55 per cent of the total inflows during the July-November period of FY25.

“Any political change in theses counties could deal a blow to inflows for Pakistan,” said a currency expert.

Published in Dawn, December 10th, 2024