ISLAMABAD: Pakistan’s remittance flow declined by more than 7 percent in July on a month-on-month basis, the Pakistani central bank said on Thursday, with Saudi Arabia being the largest contributor. 

The South Asian country recorded an inflow of $2 billion as part of remittances sent by Pakistanis working abroad, according to the State Bank of Pakistan (SBP). 

However, the inflows recorded a huge drop of 19 percent on a year-on-year basis. 

“Remittances inflows during July 23 were mainly sourced from Saudi Arabia ($486.7 million), United Arab Emirates ($315.1 million), United Kingdom ($305.7 million) and United States of America ($238.1) million respectively,” the SBP said in a statement. 

Pakistan and Saudi Arabia have deep cultural, defense and economic ties, deeply rooted in history and religion. The Kingdom is home to over two million Pakistanis, making it the largest contributor to remittance inflows into the South Asian country. 

The decline in remittances comes at a time when Pakistan is about to witness the transition of power to a caretaker government in August that would run the South Asian country for at least three months until a general election, due in November. 

Embroiled in economic and political crises for more than a month, Pakistan secured a crucial $3 billion deal with the International Monetary Fund (IMF) in late June after months of delay, with economists blaming the delay in signing the IMF deal for the economic turmoil. 

Dr. Vaqar Ahmed, Joint Executive Director at the Sustainable Development Policy Institute (SDPI), said the government’s inability to sign a timely deal with the IMF had been damaging to the economy. 

“During [Finance Minister Ishaq] Dar’s tenure, particularly three areas, energy prices, exchange rate, tax exemptions and also tax rates remained under the observations of IMF and conditions related to these areas became more stringent,” Ahmed told Arab News.