KARACHI: Remittances sent by overseas Pakistanis in the first month of the current fiscal year met the government’s expectations, with significant growth compared with the preceding month.
The latest data issued by the State Bank of Pakistan (SBP) on Monday showed that inflows were 13 per cent higher in July than in the same month of the previous fiscal year.
The country received a total of $3.6 billion in July, compared with $3.2bn in the same month last year. Month-on-month, the growth was 4.5pc.
The inflows are encouraging for the government, which has set an ambitious $44bn remittance target for FY27, up from $41.5bn in FY26.
Inflows from Middle East stay robust amid ongoing war
Despite more than five months of the war in the Middle East, remittances did not decline; instead, they increased compared with the preceding year. There were some reports of Pakistanis leaving the UAE, but remittances from the Emirates remained intact and, in fact, increased despite the war in FY26.
Currency experts said that thousands of Pakistanis have migrated to the Middle East for jobs despite the war; most of them have gone to Saudi Arabia.
They said the government is likely to meet the FY27 target. Remittances have not only left export proceeds far behind but have also helped the SBP to improve its foreign exchange reserves. The central bank is a regular buyer of US dollars in the interbank market, but SBP reserves are still largely composed of deposits placed by Saudi Arabia and China, which together account for more than 50pc.
Despite the huge inflow of remittances in FY26, the current account remained negative, with the trade deficit of over $39bn consuming most of them.
The current year also began with a $3.5bn trade deficit, which alarmed the economy’s stakeholders, who feel the cheaper dollar is leading to higher imports and an unmanageable deficit.
Pakistan has failed to increase exports to China despite Beijing now being Islamabad’s largest trading partner, and the trade balance remains largely in China’s favour. Moreover, under-invoicing and smuggling from China are also very high, as the Pakistani market is flooded with Chinese products nationwide.
The major corridors of workers’ remittances in July were Saudi Arabia ($913.9m), the UAE ($737.3m), the UK ($555.5m), the US ($317.2m), and EU countries ($452m).
Published in Dawn, August 11th, 2026
