ISLAMABAD: Pakistan’s remittances surged to $3.1 billion in December 2024, reflecting a 29.3% year-on-year increase, according to data released by the State Bank of Pakistan (SBP) on Friday. This significant growth underscores the ongoing financial support from overseas Pakistanis amid the country’s challenging economic conditions.
The SBP data also revealed a 5.6% month-on-month rise in remittances. Cumulatively, inflows during the first half of FY2024-25 (July-December) reached $17.8 billion, marking a 32.8% increase compared to $13.4 billion in the same period of FY2023-24.
The rise in remittance inflows is attributed to Pakistan’s economic recovery, supported by IMF loans, a stable currency, incentives for banks and exchange companies, and a growing trend of skilled workers migrating abroad.
Key drivers of this growth include reforms aimed at curbing illegal foreign exchange trading and measures implemented by the SBP to encourage official remittance flows. Additionally, the decline in global inflation has enabled Pakistani migrants to remit more money to their families.
Former Finance Ministry Advisor Dr. Khaqan Najeeb told Geo.tv that the rise in remittances is due to several factors. These include the expansion of the Pakistani diaspora, higher earnings in key destination countries, exchange rate stabilization (reducing the gap between interbank and open-market rates), and improvements in digital payment infrastructure.
He also noted that rising inflation in Pakistan has increased the demand for financial support from families abroad. “Higher remittances have played a vital role in managing the country’s external account,” he said.
In December 2024, the primary sources of remittances were Saudi Arabia ($770.6 million), the United Arab Emirates ($631.5 million), the United Kingdom ($456.9 million), and the United States ($284.3 million). Other GCC countries contributing to the inflows included Oman ($108.5 million), Qatar ($89.2 million), Kuwait ($71.1 million), and Bahrain ($41.2 million).
Remittances from the Pakistani diaspora remain a critical source of external financing, enhancing foreign exchange reserves and supporting the balance of payments.
Looking ahead, both the central bank and the government anticipate remittances to reach a record $35 billion in FY2024-25.
