Karachi: As the economic woes of Pakistan continue to multiply each day, remittance inflows have declined by 11% too during the first seven months (July–January) of the current fiscal year (FY23).
According to the State Bank of Pakistan (SBP), during the period under review, the total remittance inflows amounted to $16 billion compared to $17.987 billion recorded in the same period a year earlier.
Workers’ remittances recorded an inflow of US$1.9 billion during Jan 23. For detail see https://t.co/7XBd4uOcHC pic.twitter.com/f14W0Z6s5j
— SBP (@StateBank_Pak) February 13, 2023
In January alone, on a month-on-month basis, the total remittance inflows dropped by nearly 10% because inflows stood at $1.894 billion.
Earlier, experts were attributing the sharp decline in inflows to the artificial cap that was placed by exchange companies on dollar supply. Due to this, overseas Pakistanis were opting for unofficial channels, hawala/hundi, as they were offering a much higher exchange rate.
The cap, however, was removed by the end of January as per International Monetary Fund (IMF) conditions to pave the way for the release of the critical $1.1 billion loan tranche.
Market watchers now suggest that this will positively impact remittance inflows as banks will be offering high returns for the dollar.
