KARACHI: Remittances from overseas Pakistani workers soared by nearly 40 per cent year-on-year in February 2025, reaching $3.12 billion, according to State Bank of Pakistan (SBP) data released on Monday.
Compared to January 2025, remittance inflows increased by 3.8pc, providing much-needed financial support to the economy, government reserves and liquidity for importers.
For the first eight months of FY25 (July-February), total remittances reached $23.97bn, marking a substantial 32.5pc rise compared to the same period a year ago.
The government had projected total remittances of $35bn for FY25, around $5bn more than last year. However, remittances have already exceeded expectations, with additional inflows of $5.9bn in just eight months.
Inflows near $24bn in eight months, up 32.5pc
For economists and financial analysts, the rise in remittances is both a positive and negative indicator — while the surge in inflows has helped stabilise the rupee and support the economy, it reflects the government’s increasing dependence on remittances, rather than boosting exports, to sustain foreign exchange reserves.
Despite an ambitious export target of $60bn, actual exports remain sluggish and are projected to reach only $30bn by the end of FY25.
Remittances by country
The inflows noted a record increase from the United Arab Emirates during July-February as it rose to $4.857bn with a growth of 55.7pc. Similarly, the highest remittances came from Saudi Arabia, increasing by 34.6pc to $5.896bn during the period.
The inflows from the United Kingdom and the United States were $3.565bn and $2.402bn, respectively.
Interestingly, remittances from European Union countries — at $2.829bn — surpassed inflows from the Gulf Cooperation Council (GCC) nations — $2.396bn — during the eight months.
In February, the remittances inflows were mainly sourced from Saudi Arabia ($744.4 million), the United Arab Emirates ($652.2m), the United Kingdom ($501.8m), and the United States ($309.4m).
In an effort to increase remittance inflows, the government is pushing for more overseas employment opportunities for Pakistani workers.
However, high unemployment rates in Pakistan have already driven hundreds of thousands of youth to seek jobs abroad annually, contributing to the record surge in remittances.
Published in Dawn, March 11th, 2025