The remittances crunch

The inflow of remittances to Pakistan has yet to show a satisfactory trajectory since January 2022. The monthly inflow of remittances for the first three quarters of 2023 was lower than both the previous year and 2021. The count of remittances from January to November 2023 was $23.96 billion, reflecting a decrease of $3.83bn compared to the corresponding period in 2022 and $4.6bn compared to 2021. The World Bank, in its report titled “Leveraging Diaspora Finances for Private Capital Mobilisation,” has projected a 10 per cent decrease in remittance flows to Pakistan for the current fiscal year. This revelation undoubtedly raises concerns because remittances hold a paramount significance for Pakistan and play a pivotal role in shaping Pakistan’s economic landscape. In the realm of global financial flows, Pakistan ranks sixth among the top countries receiving remittances, with the remittances-to-GDP ratio exceeding 7pc.