KARACHI: The Middle East crisis, which does not look to end in the near future, would surely hit the foreign exchange reserves of countries like Pakistan.

However, data issued by the State Bank of Pakistan (SBP) on Thursday showed that its reserves rose by $41 million to $16.341 billion during the week ended on March 6. In its latest monetary policy statement, it specifically mentioned that it has been buying dollars from the interbank market to improve its reserves.

Fortunately, the inflow of remittances continues to grow, as noted in February. The remittances in Feb were $3.3 billion, but were lower than the inflows in January.

Some currency market experts believe the inflows should be higher, as they usually grow by 20 per cent during Ramazan. Millions of Pakistanis are employed in the Middle East, and their total contribution during the first 8 months of FY26 was 53pc of total inflows.

However, the escalating war has threatened many jobs in the Middle East, and new jobs are not available there. The government, which relies heavily on remittances for its foreign exchange earnings, has been encouraging as many Pakistanis as possible to go abroad for work. The largest employers are the Arab counties and this door has been shut as long as war continues. The SBP’s foreign exchange reserves rose by $2.017bn since July 2025. Similarly, commercial banks’ holdings improved by $595 million to $5.257bn. The country’s total reserves reached $21.598bn, with an addition of $2.622bn since July 2025.

The State Bank has allowed the import of crude oil, which means it will provide dollars and it affect its reserves. “In view of the prevailing situation and critical importance of crude oil and petroleum products for the country, it has been decided to allow import of crude oil/petroleum products on CIF basis for 60 days from the date of issuance of this circular letter,” said a circular.

Published in Dawn, March 13th, 2026