Diversification of markets needed

Home remittances continue to fall. In the first five months of this fiscal year (July-November 2022), inflows of remittances totalled about $12.009 billion, down from $13.287bn in July-November 2021, according to the State Bank of Pakistan. There are several reasons for this decline of 9.6 per cent, two cyclical and one structural. Inflows through illegal channels (Hundi/Havala) and smuggling of hard currencies to neighbouring Afghanistan are on the rise. And these are cyclical issues — Pakistan periodically experiences a rise or fall in these two trends. The third reason is structural. Over twos-third of our remittances—about 68.2pc—originate from just four countries: Saudi Arabia, UAE, UK, and USA. If we include Bahrain, Kuwait, Oman and Qatar, the share of eight countries in our total remittances rises close to 80pc. Pakistan needs to re-design its workforce export policy. But even the most meticulous new policy and its most stringent implementation cannot yield appreciable results in the short run. In the long run, though, it will.