KARACHI: Inflows of workers’ remittances rose to a historic level of $29.4 billion during the last fiscal year (FY21) supported by the government’s proactive policy measures.

The State Bank of Pakistan (SBP) Tuesday reported that workers’ remittances, sent by overseas Pakistanis, recorded a healthy growth of 27 percent during July-June of FY21 over the last year. On a cumulative basis, remittances rose to a historic annual high of $29.4 billion during FY21 compared to $23.13 billion in the same period of FY20, depicting an increase of $ 6.24 billion. The substantial growth achieved in FY21 is the fastest rate of expansion since FY03.

According to SBP, the sufficient and healthy inflows of workers’ remittances have helped to improve the country’s external sector position despite the challenging global economic conditions in the past year.

According to SBP, workers’ remittances also continued their unprecedented streak of above $2 billion for a record 13th consecutive month. Seasonal pre-Eid related inflows helped to further boost remittances level during June.

Home remittances rose by 9 percent or $215 million to $2.68 billion in June 2021 compared to $2.473 billion in June 2020. Month on Month basis, remittance inflows, during June 2021, were also some 8 percent higher than May 2021, in which $2.49 billion were arrived.

The SBP further said that overall, record high inflows of workers’ remittances during FY21 have been driven by proactive policy measures by the federal government and SBP to incentivise the use of formal channels, curtailed cross-border travel in the face of COVID-19 infections, altruistic transfers to Pakistan amid the pandemic and orderly foreign exchange market conditions.

The detailed analysis revealed that remittance inflows during FY21 were mainly sourced from four major corridors including Saudi Arabia, United Arab Emirates, United Kingdom and the United States.

With 26 percent share in overall home remittances inflows, Saudi Arabia remained the largest contributor. Remittances inflows from Saudi Arabia mounted up by 16 percent to $7.66 billion in FY21. Some $2.754 billion arrived from the US in FY21 compared to $1.743 billion in FY20, showing an increase of 58 percent. Workers’ remittances from the UK and UAE surged by 58.3 and 9 percent, respectively. Pakistan received remittances amounted to $4.067 billion from the UK and $6.11 billion from UAE during the last fiscal year.

Copyright Business Recorder, 2021