Remittances crucial for Pakistan's economy: ADB report

ISLAMABAD: The Asian Development Bank (ADB) report termed remittances crucial for Pakistan’s economy, equivalent to 10% of the country’s GDP, ARY News reported quoting ABD report. 

According to ADB blog report on remittances in Pakistan, remittances saw a significant increase of 19.8%, reaching a record high of $31.1 billion, during the COVID-19 pandemic.

The report stated that remittances play a vital role in reducing poverty and increasing foreign exchange reserves. The ADB recommended providing more incentives to overseas Pakistanis to further boost remittances.

The report also mentioned that remittances can be a reliable source of funding during economic crises and fluctuations. With the right policy measures, remittances can be converted into investments, leading to increased economic productivity and growth.

However, the report said that Pakistan is facing challenges in balancing its external payments.

READ: Workers’ remittances record US$3bn inflow during July

It is noteworthy that remittances sent by overseas Pakistanis recorded an inflow of US$ 3 billion during July 2024, the first month of the current fiscal year.

In a statement, the central bank said that in terms of growth during July 2024, remittances increased by 47.6 percent on a year-on-year basis

“Remittances inflows during July 2024 were mainly sourced from Saudi Arabia (US$761.1 million), United Arab Emirates (US$611.1 million), United Kingdom (US$ 443.5 million), and, the United States of America (US$300.1 million),” the SBP’s statement read.