Pakistan’s Remittance Inflow
The inflow of remittances from overseas workers into Pakistan totaled $2.92 billion in November 2024, marking a 4.5% decline compared to $3.05 billion in October 2024, according to data released by the State Bank of Pakistan (SBP) on Monday.
However, when compared to the same month in the previous year, remittances saw a significant increase of 29.1%, up from $2.26 billion in November 2023.
Over the first five months of the fiscal year 2024-25 (5MFY25), remittances rose by 33.6% on a year-on-year (YoY) basis, reaching $14.8 billion as opposed to $11.1 billion during the corresponding months of the previous fiscal year (5MFY24).
These remittances play a crucial role in bolstering Pakistan’s external account, stimulating economic activity, and supplementing the incomes of households dependent on remittances.
Finance Minister Muhammad Aurangzeb expressed optimism about remittance trends, stating that remittance inflows are expected to reach an all-time high of $35 billion in the current fiscal year (FY25), up from $30.25 billion in FY24.
Breakdown of Remittance Sources
Saudi Arabia was the leading source of remittances in November 2024, with its nationals sending $729.2 million. This amount was down by 5% month-on-month but was 34% higher compared to the $543.6 million sent in November 2023.
Remittances from the United Arab Emirates (UAE) decreased marginally by 0.25% month-on-month, falling from $620.9 million in October 2024 to $619.4 million in November. However, when compared to November 2023, remittances from the UAE increased by over 50%, up from $411.8 million.
Remittances from the United Kingdom (UK) stood at $409.9 million during November, a 4.6% month-on-month decrease from the $429.8 million reported in October. However, on a year-on-year basis, remittances from the UK rose by 20%.
Remittances from the European Union (EU) saw a 10% decline month-on-month, reaching $323.1 million in November compared to $359.1 million in October. Meanwhile, the United States contributed $288.2 million, down by 4.3% month-on-month.
To further encourage remittance flows, the SBP introduced reforms to the incentive structure for banks and exchange companies (ECs) in October 2024.
This revamped system includes two types of incentives: Fixed Component Incentives and Variable Component Incentives. These measures aim to improve the process of remittance transfers by making it more attractive for financial institutions and remittance channels to facilitate these payments.
I am a dynamic professional, specializing in Peace and Conflict Studies, Conflict Management and Resolution, and International Relations. My expertise is particularly focused on South Asian Conflicts and the intricacies of the Indian Ocean and Asia Pacific Politics. With my skills as a Content Writer, I serve as a bridge between academia and the public, translating complex global issues into accessible narratives. My passion for fostering understanding and cooperation on the national and international stage drives me to make meaningful contributions to peace and global discourse.
