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Wednesday, September 20, 2023

Pakistan’s foreign remittances increase by 24.4% compared to same time last year

After the highest recorded remittances for a month in July, remittances have dipped but still remain over the $2 billion mark and are 24.4% higher when compared to last year.

This year in the second quarter of the fiscal year Pakistan sees a surge in foreign remittances as remittances grew by 24.4% for the month of August 2020 compared with August of last year.

Prime Minister Imran Khan took to twitter on Monday with the positive news saying, “overseas Pakistanis sent $2,095 million in remittances in August 2020 – 24.4% higher than August last year – in addition to the record $2,768 million in July 2020. For the first two months of this fiscal year (FY21), our remittances are up 31% over the same period of last year.”

Pakistan’s foreign remittances surging

With remittances in July topping the charts and being the highest amount of remittances ever recorded in a month for Pakistan, the country sees a spike of 31% in foreign remittances for the first two months of the fiscal year compared with last year. Although overall remittances have contracted by 24% when compared to the record high in July, they are still over the $2 bn mark.

“Historically, remittances peak in the months around Eid festivals every year as happened in June and July ahead of Eidul Azha. And they take a dip in forthcoming months (as happened in August),” BMA Capital Executive Director Saad Hashmi said while talking to The Express Tribune.

Read more: Economy of Pakistan and The Coronavirus

Another factor for the surge in remittances can also be linked to lower spending on the annual Hajj pilgrimage because of the downsized Hajj of 2020 amid the coronavirus pandemic.

Read more: Ready to protect Pakistan economy from virus shock: Governor SBP

Both the government and State Bank have taken measures to promote the inflow of foreign remittances which are expected to increase next year. “Pakistan is expected to receive $24-25 billion in FY21,” said Hashmi. A visibly positive sign for next year is that remittances have increased considerably from the US and UK by 51% and 67% respectively.

GVS News Desk