Remittances the largest source of forex for Pakistan.

Byline: SHABBIR KAZMI

During March 2022, Pakistan received a total of US$2.8 billion of inflows under workers' remittances. During the month under review the remittances increased by 28.3%MoM and 3.2%YoY.

This is the highest ever monthly level for workers' remittances. A point worth noting is that the remittances have continued their unprecedented run and remained above US$2 billion since June 2020.

Cumulatively during first nine months of the current financial total remittances received recorded at US$ 23.0 billion, posting a growth of 7.1% as compared to the same period of the last year.

Remittances inflows during March 2022 mainly originated from Saudi Arabia (US$678 million), United Arab Emirates (US$515 million), United Kingdom (US$401 million) and United States of America (US$300 million).

According to the analysts there is a larger influx of funds into Pakistan prior to the commencement of month of Ramazan and Hajj season. A lot of Pakistanis and their families visit Pakistan to celebrate Eidul Fitr and Eidul Azha with their relatives.

Over the years the concerted efforts of the Government of Pakistan, State Bank of Pakistan, commercial banks and exchange companies have played a key role in using the formal banking system the remittance of funds. However, a lot more has to be done to ensure funds transfer with the click of a few keys of the computer or the mobile phone.

First and the foremost the credit of this colossal increase in remittances goes to the overseas Pakistanis. According to an analyst Pakistanis working in the harsh climate of Saudi Arabia and United Arab Emirates collectively contribute the largest percentage. After the COVID pandemic and imposition of certain taxes on maintaining the families, many of the Pakistani citizens are living there alone. Therefore, they send higher amounts to their families living in Pakistan.

It is believed that bulk of the remittances originating from the United Kingdom and the United States pertains to highly educated professionals from Pakistan. A point to be noted is that when professional started moving to these two high developed countries, many Pakistanis opposed their decision, on the fears of brain drain. However, they became torchbearer for the younger generation and now have become a source of funds their near and dear still living in Pakistan.

The use of the formal banking system is on the rise because of technology deployment by the banks. During the October-December 2021...