Islamabad: Pakistan’s overseas worker remittances totaled USD 3.2 billion in April, showing a 22% decline compared to the record-high USD 4.1 billion in March, according to the latest data from the State Bank of Pakistan (SBP). Despite this monthly drop, remittances in April still marked a notable 13% year-on-year increase.
In the first ten months of the fiscal year, remittances have surged by 31%, reaching a total of USD 31.2 billion, compared to the same period last year. The rise is attributed to a combination of factors, including the government’s ongoing efforts to encourage the use of formal channels for remittance transfers, as well as the increasing number of Pakistanis working abroad.
Analysts had anticipated the dip in remittances for April, as seasonal factors related to Ramadan and Eidul Fitr came to an end. Typically, overseas Pakistanis send more money back home leading up to Eidul Azha, which is expected to see a rebound in remittance inflows during May and June.
Sana Tawfiq, head of research at Arif Habib Limited, noted that while the April drop was in line with forecasts, the monthly average of over USD 3 billion in remittances remains stable. This steady inflow is crucial for Pakistan’s foreign exchange reserves, particularly as the country continues to navigate economic challenges.
Looking ahead, the SBP projects that remittances will continue to rise throughout FY25, with total inflows expected to reach approximately USD 38 billion by the end of the fiscal year. This will help support Pakistan’s foreign exchange reserves, which are projected to increase to USD 14 billion by June 2025.
Despite concerns over a potential current account deficit due to the normalisation of remittances and widening trade gaps, the overall trend of increasing remittance flows presents a positive outlook for the country’s economic recovery.
As Pakistan seeks a USD 1 billion loan tranche from the International Monetary Fund (IMF), the sustained remittance inflows play a key role in strengthening the country’s financial position. However, the ongoing regional tensions and the uncertain global economic climate remain factors to watch in the months ahead.
Samra Zulfiqar, a real estate analyst at Zameen.com, is passionate about finding projects that offer buyers the best returns. Her keen insights spotlight the market’s most promising opportunities.
