The cumulative foreign currency inflows channelled through Roshan Digital Accounts (RDAs) by overseas Pakistanis have exceeded a remarkable milestone of $6.5 billion.
In a message of gratitude, the SBP took to its official Twitter handle, stating, “we thank our overseas Pakistanis for their valued trust.”
The central bank data illustrates that by the end of June 2023, the inflows reached $6.35 billion, while the total number of accounts stood at 585,885. This data reveals a robust growth in gross receipts over the past six weeks, culminating on August 11, 2023, by $150 million. Notably, over the past one-and-a-half months, the number of accounts surged by more than 14,000.
Experts in the financial realm acknowledge the pivotal role RDA funds have played in stabilising the nation’s foreign exchange reserves.
However, these flows have witnessed a significant slowdown during the past 16 months of the Pakistan Muslim League-Nawaz (PML-N) government’s tenure, attributed to a combination of global and local economic slowdowns and heightened political uncertainty.
Sana Tawfik, an economist at Arif Habib Limited, anticipates that once political stability is achieved through the upcoming general elections, inflows would regain their momentum. Tawfik emphasises the vital connection between stability and both economic equilibrium and the attraction of investments to the country.
Tawfik suggests that the new government must align the rate of return on Naya Pakistan Certificates (NPC) with global trends to enhance their appeal to non-resident Pakistanis. The prevailing high global inflation rates and interest scenarios have driven US treasury bonds’ returns to 5.36%, in stark contrast to the sub-1% rates before the Russia-Ukraine conflict in February 2022 and the onset of the Covid-19 pandemic.
While the PML-N government revised NPC rates to a maximum of 7-7.5%, Tawfik deems this increase insufficient, given the tight global liquidity situation and monetary policies.
