KARACHI, Feb 9: Bangladesh is trying to catch up with Pakistan in attracting foreign exchange through its expatriate citizens. Bangladeshi workers sent back home $1.576 billion in six months to December 2003 , up from $1.461 billion they had remitted a year ago, according to the latest data released by Bangladesh Bank.

In July-December 2003, inward cash remittances from expatriate Pakistanis totalled $1.845 billion, down from $2.130 billion they had sent back home in July-December 2002.

This means that Bangladesh managed to reduce the gap between inward remittances from overseas Pakistanis and Bangladeshis to $269 million in July-December 2003, from $669 million in a year- ago period.

Pakistan and Bangladesh rank fourth and fifth among the group of five countries whose overseas workers' remittances claim the largest shares in the global pie. The other three are India, Mexico and the Philippines.

In its last fiscal year April-March 2002-03, India attracted a record $14.8 billion workers remittances. In April-September 2003, India received $8.94 billion in workers remittances and Indian bankers and economists are sure the figure would cross $16 billion.

Pakistan attracted a record $4.19 billion cash remittances from overseas workers in its last fiscal year July-June 2002-03. In 2003, Mexico saw a big increase in its workers' remittances that surged to $13.2 billion from $9.8 billion in 2002.

And the Philippines also seems set to record a modest increase in its workers remittances in 2003: in 11 months to November 2003, its workers' remittances reached $6.9 billion. In full calender year of 2002, the Filipinos had sent back home about $7.2b billion.

As is evident from the above statistics, India, Mexico, the Philippines and Bangladesh are witnessing a rising trend in their workers' remittances. But Pakistan is experiencing a declining trend.

Its economic managers satisfy themselves saying that the remittances - though declining - are still in line with the target of $3.6 billion set for the current fiscal year.

They say the workers' remittances are bound to fall during this fiscal year because large one-off remittances have almost come to a halt. The tightening of anti-money laundering laws in the wake of the September 11, 2001 terror attacks had triggered such remittances.

But as the pie of Pakistani workers' remittances is actually much larger than what the economic managers believe it to be - there is still room for the country to attract more of foreign exchange through remittances.

Bankers point out that whereas the country received $4.19 billion cash workers remittances through banks in the fiscal year July-June 2002-03, the State Bank did not purchase dollars from money changers.

In the fiscal year 2001-02, the remittances through banks had totalled $2.390 billion and the SBP had purchased $1.376 billion from money changers. Since the dollars sold by money changers largely represented the inflow of workers' remittances through unofficial means one can assume that total remittances in the fiscal year 2001-02 stood at ($2.390bn plus $1.376bn) i.e. $3.766 billion.

If this figure is compared with the workers' remittances of $4.19 billion received in the fiscal year 2002-03, the difference comes to $424 million only. For many bankers this small sum of money represents too small an increase in remittances when seen in the backdrop of post-9/11 developments.

SBP officials also privately admit this. But they point out that in the last fiscal year the central bank had also purchased $429 million indirectly from the money changers. The central bank had asked them to sell to it a percentage of the foreign exchange inflows they had been getting through the export of non-dollar currencies to Dubai.

So, in effect, Pakistan managed to get ($4.19bn plus $429m) i.e. $4.619 billion in workers' remittances in the last fiscal year.