ISLAMABAD (Ahmed Mughal):- The Pakistan, which bridge current account deficit by remittances, has faced serious downward trend in overseas workers remittances.
The Central Bank of the country (SBP) has issued a provisional data on worker remittances of August 2019 here on Friday.
According to the data, the overseas Pakistani workers have sent $1.69 billion to home. This amount is less by almost $300 million as compare to July 2019 and $347 million from Aug 2018. The data shows that inflows from all over the world including Saudi Arabia, United Arab Emirates have decreased.
The country received only $1,690.9 million in the August 2019 as compared with US$ 2039.3 million received during July 2019. This shows that the workers remittances decreased by $348.4 million on month-on-month basis.
On cumulative basis, workers’ remittances stood at $3,730.2 million during Jul-Aug FY20 compared with 4,071.1 million of last year.
On Aug 2019, Pakistan received from Saudi Arabia $377 million less than 88 million from the same month of the last year. The country also received $348 million by decreasing $124 million from corespondent month of last year. The USA based Pakistan workers sent $297 million which is less than $67 million of same period of last year.
The UK based Pakistani workers sent $250 million to their families as compare to $294 million during last Aug. The Pakistanis from GCC countries including Bahrain, Kuwait, Qatar and Oman sent $158.60 million as compare to $193 million during Aug 2018. The country has also received $ 58.14 million from European countries as compare to $59.69 million in Aug 2018.
Pakistan also received remittances from Malaysia Norway, Switzerland, Australia, Canada, Japan and other countries. The workers of these countries remitted $200.42 million as against $ 272.62 million received in August 2018.
The State Bank said that the deceasing mode in overseas workers remittances was due to long holidays of Eidul Azha. The Eidul Azha was celebrated on second week of Aug but it was also been celebrated same month during last year.
There is news on surface that Saudi Arabia has decided to stop for taking any more services of Pakistani doctors. This decision also put negative impact on remittances from Saudi Arabia.
Indeed, the Government would worry about the downward trend in remittances. The Govt relays on this front to bridge the current account deficit.
Pakistan Government is expecting that it will get $22.53 billion from overseas worker remittances to keep the current account deficit at $6.7 billion. The remittances had surged by 9.68 percent to $21.841 billion during last fiscal year as compared with the previous year.
The overseas worker remittances is the main source to fill the gap of current account deficit due to less FDI and exports.
Last year, Pakistan’s import bill reached at $53.5 billion while exports reached only $24.2 billion. The Govt filled the gap through remittances of $21 billion. other amount was materialized through borrowing and FDI.
The declining trend in remittances will likely to forces PTI Govt to more borrowing from external front.