KARACHI: Remittance inflows into Pakistan jumped by nearly 24.2 percent in February to $2.266 billion as government incentives attracted people abroad to send extra money home through formal channels, the financial institution reported on Thursday.
Workers’ remittances reached an unprecedented level of $18.7 billion within the eight months of the financial year , up 24.1 percent, compared with an equivalent period a year ago.
“Policy measures undertaken by the govt and SBP (State Bank of Pakistan) to encourage inflows through formal channels, limited cross-border travel thanks to COVID-19, medical expenses and altruistic transfers to Pakistan amid the pandemic, and orderly exchange market conditions, contributed to the present sustained rise in workers’ remittances,” the SBP said.
Remittances continued exceptional performance and remained above $2 billion for the ninth consecutive month in February.
“Remittances in February are maintaining the momentum, which is positive and therefore the much-needed to support the country’s external account as exports still remain sticky at $2 billion while international oil prices have shown the strength lately ,” said Saad Hashemy, an executive at BMA Capital.
The SBP’s data showed that an outsized a part of remittance flows in July-February 2021 came from Saudi Arabia , the United Arab Emirates, the uk , and therefore the us .
Inflows from Saudi Arabia , the main remittance source for the country, increased 19.5 percent to $5 billion in July-February 2021.
Pakistani citizens working within the UAE sent $3.9 billion in July-February, compared with $3.7 billion within the corresponding period of the last year, showing a 6 percent increase year-on-year.
Remittances from the united kingdom rose 56.8 percent to $2.5 billion. The inflows from the US increased 46.7 percent to $1.6 billion. Pakistani diaspora has defied pandemic blues with the record surge in remittances. They travelled less to Pakistan and continued to send savings back range in the tough times of the COVID-19.
Analysts expect an upward trend in key non-debt creating exchange inflows that are remittances to continue within the coming months, as restrictions on international travel could also be extended thanks to the surging cases of the virus in several countries.
The seasonal factors like Ramazan and Eid-ul-Fitr, which are coming, could also cause an increase in remittances. The overseas Pakistani workers send extra money to their families to satisfy expenses within the holy month of Ramazan and Eid festive.
“We believe remittances would increase 19 percent YoY in FY21 to $27.6 billion given prolongation of travel restrictions amid a resurgence of COVID,” an analyst at Foundation Securities during a client note said. the govt and therefore the central bank’s initiative to draw in remittances through the Roshan Digital Accounts from non-resident Pakistanis is additionally supporting remittances.