Inflow of workers’ remittances hit a record $31.237 billion in fiscal year 2021-22, with a growth of 6.1% compared to $29.449 billion in the same 12-month period of the previous year.
According to data released by the State Bank of Pakistan (SBP) on Monday, inflows amounting to $2.761 billion arrived during June 2022 alone, compared to $2.332 billion in May 2022, an increase of $428.5 million or 18.4% on a month-on-month basis.
On a year-on-year (YoY) basis, a growth of 1.7% was witnessed in June 2022.
The central bank said that the record inflow from overseas Pakistanis was anticipated.
Remittances: $2.8bn record inflows received in March
Remittances are a crucial component of the economy for Pakistan that has seen its foreign exchange reserves deplete due to external debt servicing. With exports not nearly matching the high amount of imports, Pakistan relies on the inflow of remittances to meet its foreign exchange needs.
As per the SBP, the country’s total liquid foreign exchange reserves dropped by $132 million during the last week to $15.611 billion as of July 7, 2022 compared to $15.742 billion as of June 30, 2022.
During the week under review, SBP’s reserves decreased by $99 million due to external debt payments. SBP’s foreign exchange reserves declined to $9.717 billion by the end of the last week, down from $9.816 billion. Net foreign reserves held by commercial banks also decreased by $33 million to $5.893 billion.
July-May period: C/A deficit crosses $15bn mark
Breakdown of remittances
Saudi Arabia remained the largest contributor in workers’ remittances with $7.743 billion during FY22, up from $7.726 billion recorded in the same period of the previous fiscal year. On the other hand, inflows amounted to $5.842 billion from the United Arab Emirates, registering a decline of 5%. An inflow of $4.487 billion was recorded from the United Kingdom and $3.082 billion from the US.
Remittance inflows during June 2022 were mainly sourced from Saudi Arabia worth $666 million, followed by the UAE ($494 million), UK ($454 million) and the US ($284 million).