KARACHI: The country received record high remittances of $2.768 billion in the first month of the new fiscal year, following the record $23bn remittances during the outgoing financial year.
“This ($2.768bn) is the highest-ever level of remittances in a single month in Pakistan,” the State Bank of Pakistan (SBP) said in its latest data issued on Monday.
Prime Minister Imran Khan took to Twitter soon after the SBP announcement and said: “More good news for Pak economy. Remittances from overseas Pakistanis reached $2,768 mn in July 2020, highest ever amount in one month in the history of Pakistan. This is 12.2% increase over June 2020 and 36.5% increase over July 2019.”
In terms of growth, workers’ remittances increased by 36.5 per cent over July 2019 year-on-year basis and 12.2pc over June 2020 (month-on-month), the SBP said, adding that given the Covid-19 impact on the global economy, this increase was encouraging.
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Though the export of manpower is almost zero after the novel coronavirus hit the country in March this year, the inflows of remittances have risen. The State Bank attributed the growth to the Pakistan Remittance Initiative, which is what it has always credited whenever remittances rise, as well as exchange rate movements. Financial sector players and currency dealers said Pakistanis sent more money to their families and other relatives to help them tide over Covid-19 challenges and support those members who lost jobs and businesses.
The SBP reported that the highest amount of remittances were received from Saudi Arabia, while in terms of percentage the highest growth was noted in inflows from European Union countries.
Pakistan received $821 million from Saudi Arabia in July this year, compared to $470m during the same month last year, an increase of 74.5pc. The country has been receiving the highest remittances from Saudi Arabia for the past several years as about one million Pakistanis are employed there.
The second biggest remittances of $538m came from the United Arab Emirates, showing a growth of 26pc compared to the same month last year.
A significant growth of 31.7pc was noted from the United Kingdom as Pakistanis living there sent $394m remittances in July.
However, remittances from the United States dropped by 22pc to $250.6m. The growth in July last year was over 13pc.
The SBP data shows that remittances from the entire Arab region have recorded a significant growth. The inflows from the Gulf countries showed 50pc growth in remittances as Pakistan received $297m in July, compared to $198m during the same month last year.
The inflows from the EU countries were surprisingly very high as these jumped by 292pc in July this year, compared to the same month last year. Pakistan received $227.5m from EU countries as against just $58m in July last year. However, the inflows from Malaysia took a nosedive as it fell to $22m in July, compared to $160m during the same month last year, a decline of 86pc.
Providing technical reasons for higher growth in remittances, the State Bank cited several factors, including orderly exchange rate conditions and policy steps taken by the bank and the federal government under the Pakistan Remittance Initiative.