KARACHI: The importance of remittances to Pakistan’s economy cannot be negated, as it provides much needed foreign exchanges in terms of dollars to boost forex reserves.
Pakistan is among the leaders in remittance outflows in the region with Bangladesh receiving $228 million, followed by Afghanistan $131 million, Myanmar $14 million. Iran over $1 million, Iraq more than $1 million and Algeria $1 million reported.
According to World Bank’s report in 2015, Pakistan stood at fifth place in terms of receiving most remittances, standing at $19.3 billion. Only India, China, Philippines and Mexico were ahead of Pakistan in terms of being largest remittance-receiving countries respectively with $72 billion, $64 billion, $30 billion and $26 billion.
A report compiled by Pew Research Center revealed over $574 billion was remitted by overseas migrants to their respective home countries in 2016, decreasing 1 percent from 2015 when it was $581 billion.
This is the second reported fall in global remittances since the financial crisis of 2007-08, but the overall levels remain double of what they were 10 years back before the global recession sunk in.
The country recorded a 3 percent decline in remittances from FY 2015-16 ($19.1 billion) to FY 2016-17 when it was recorded at $19.3 billion. Remittances play a key part in steadying the country’s external sector, which equates to almost half the import bill and cover deficit in trade of goods account.