The Ministry of Finance is optimistic that a number of government measures will help achieve the target of $24 billion foreign remittances set for the financial year 2020. It stated that foreign remittances have been recorded at $11.4 billion during the July-December of the current fiscal year.
A statement issued by the Ministry of Finance stated that "due to this increasing trend in remittances, the target of $ 24.0 billion at the end of fiscal year 2020 is likely to be achieved as the data of last five years suggests that the workers remitted more in the last six months as compared to the first six months of the fiscal years."
Sources said the Prime Minister was presented an incentive package during a meeting in November 2019, giving special incentives to banks and exchange companies for promoting remittances. As per proposal, banks would be given higher incentives and limit of remittance transactions would be reduced.
The meeting was informed that foreign exchange remittance cards are being renewed to bring improvement. The government also discussed proposal to initiate remittances promotion scheme which would award prizes to the overseas Pakistanis for remitting the highest amount of remittances.
The proposals also included mandatory condition for opening of bank accounts for Pakistanis going abroad and State Bank of Pakistan would give incentives to the banks on the basis of their performance with regard to increase in remittances, and post offices for providing the service of foreign remittances will be gradually increased to 3,200 from existing 240.
The Finance Ministry statement added that seasonal effect was also a leading factor in boosting remittances and it was expected that with the start of Ramadan and the following Eid, the flow of remittances would increase as the workers generally send more money during the holy events and activities.
Giving a break-up of the remittances received during the Jul-Dec 2019, the statement said that the remittances reached $ 11.394 billion as compared to $ 11.030 billion in the corresponding period last year, showing a growth of 3.3 percent. Overseas Pakistani workers remitted $ 2.097 billion in December 2019 as compared to $ 1.819 billion during November 2019.
On month-to-month basis, the remittances increased by $277.56 million in December with a growth of 15.25 per cent, the highest recorded remittances in a month since May 2019. Similarly, on year-to-year basis, remittances witnessed a growth of 20 per cent in December 2019 as compared to 0.14 per cent in the corresponding period of the last year. The share of remittances from Saudi Arabia was 23.0 per cent ($ 2618.0 million), UAE, 20.6 percent ($ 2349.3 million), USA,16.6 per cent ($ 1889.8 million), UK, 15.4 ($ 1753.0 million), other GCC countries 9.6 per cent ($ 1089.20 million), Malaysia, 7.0 per cent ($ 798.0 million), EU, 3 per cent ($ 339.2 million) and other countries 4.8 per cent.
The statement by the Ministry of Finance further said that increased efforts by the Pakistan Remittance Initiative (PRI) helped attract higher remittances from the Pakistani Diaspora through enhancing outreach, reimbursement of TT Charges Scheme (free-send model) and improvements in payment system infrastructure, etc. Similarly, visa fee reduction from the Kingdom of Saudi Arabia is likely to boost up the inflows while export of manpower has also been increased from 382,000 to 625,000 during January-December 2019, with an increase of 243,000 as compared to the corresponding period of the last year.
The government had improved its diplomatic relations with the Gulf States which had helped restore the confidence of foreign employers in Pakistani workforce. Similarly, reimbursement of TT Charges Scheme had also been revised in December 2019. Accordingly, the amount of home remittance transaction equal to and above USD 100 but less than USD 200 (or equivalent in other currencies) would be reimbursed at SAR 10 while the amount of home remittance transaction equal to and above USD 200 (or equivalent in other currencies) would continue to be reimbursed at SAR 20. The ministry added that in order to further encourage promotion of home remittances through formal channels, the government of Pakistan had re-launched the performance based scheme effective from January 01, 2020 in which, Re 1 per each incremental USD mobilized over 15 percent growth in remittances in calendar year 2020 compared with the levels achieved in calendar year 2019.
Comments
Comments are closed.