Saudi Arabia, UAE largest contributors to Pakistan’s $18 billion remittances — SBP

KARACHI: Saudi Arabia and the United Arab Emirates (UAE) remained the largest contributors to Pakistan’s remittance inflows that increased to a record high of $18 billion during the seven months of the current fiscal year (7MFY22), the central bank data showed on Friday.
Pakistan received $2.14 billion in January as the country continued to get more than $2 billion in remittances from overseas workers for 20 consecutive months.
“Remittances declined by 5 percent compared to January 2021, partly reflecting an easing of travel restrictions,” the State Bank of Pakistan (SBP) said in an official statement, adding: “Compared to the previous month, December 2021, they fell by 14.9 percent due to seasonality.”
Home to over two million Pakistani workers, Saudi Arabia once again emerged as the single largest remittance outflow source for the country.
Pakistani workers from Saudi Arabia remitted $540 million during the month of January, though the amount was slightly low compared to the previous month due to ease in travel restrictions.
The country has so far received $4.6 billion between July 2021 to January 2022 from its nationals residing in the kingdom, the SBP data showed.
The UAE remained the second largest contributor to Pakistan’s remittance inflows which were recorded at $374 million as compared to $453.2 million that the country received in December 2021. The combined inflow from the UAE stood at $3.4 billion during the current fiscal year.
Analysts said stronger inflows of remittances from Saudi Arabia and the UAE continued to support Pakistan’s balance of payment position and played a significant role in the country’s domestic economic growth.
“These major contributions from Saudi Arabia and the UAE play a vital role in supporting Pakistan’s balance of payment situation and domestic economy,” Samiullah Tariq, director research at the Pakistan-Kuwait Investment, told Arab News.
Pakistan saw a surge in remittance inflow through official channels since June 2020 after the outbreak of the COVID-19 pandemic and the ensuing travel restrictions. Some central bank policies also helped divert the remittance inflows from informal to formal channels.
The country’s measures to curb illegal flow of money also contributed to the inflows of remittances through official channels.
Pakistan had received $29.4 billion in remittances from its nationals abroad during the last fiscal year (FY21). These included $7.66 billion from Saudi Arabia and $6.11 billion from the UAE, according to the central bank data.