Remittances from Overseas Pakistan projected to hit $28bn this year

Despite the Coronavirus pandemic, the country's economy began to improve due to government measures, as country’s remittances are expected to exceed USD28 billion this year.

As per Khaleej Times, Pakistanis based in Gulf countries especially the UAE and Saudi Arabia will remit 50 percent of total remittances. Muzammil Aslam, chief executive at Tangent Capital Advisors, said remittances recorded $14.2 billion in the first six months of the fiscal year 2020-21, witnessing an increase of 24.2pc from last year.

“Interestingly, the government’s full year target is $21 billion while the central bank expects remittance inflows ranging between $24 billion to $26 billion. The current run rate indicates that inflows may hit $28.4 billion,” said Aslam.

“Tangent Capital expects low travelling volumes, improved product profiles including introduction of Roshan Digital, and more digitisation will keep remittances to robust this year,” he added.

Inflows of workers' remittances maintained a strong momentum and posted a healthy growth of some 25 percent during the first half (July-Dec) of this fiscal year (FY21). On a cumulative basis, workers’ remittances reached an unprecedented level of over $14 billion during the first half of FY21, some 24.9 percent higher than the same period last year. This is the highest half yearly growth since FY07.

According to Statistics released by State Bank of Pakistan (SBP), overseas Pakistanis remitted some $14.203 billion in July-Dec of FY21 compared to $ 10.988 billion in some period of last fiscal year (FY20), depicting an increase of $3.215 billion.

This strong growth in workers’ remittances is attributable to the increased use of formal channels on the back of sustained efforts by the government and SBP to encourage inflows through official channels as well as limited cross-border travel due to the second wave of the COVID-19 pandemic, together with favorable foreign exchange market dynamics, the SBP mentioned.