Pakistan received the second-highest workers’ remittances of the ongoing fiscal year 2023-24 at $2.8 billion in April 2024, contributing to the improvement of the country’s foreign exchange reserves and supporting stable rupee-dollar parity.

The State Bank of Pakistan (SBP) reported that workers’ remittances increased by 3.5% to $23.8 billion cumulatively in the first 10 months of FY24 compared to the same period last year.

Remittance inflows during April 2024 were primarily sourced from Saudi Arabia ($712.0 million), the United Arab Emirates ($542.3 million), the United Kingdom ($403.2 million), and the United States of America ($329.2 million), according to the bank.

Earlier, remittance inflows peaked near $3 billion in the prior month of March 2024, marking a 23-month high.

Excluding the peak in March, remittance inflows hit a 20-month high in April.

The central bank reported on Thursday that remittances increased by almost 28% in the single month of April to $2.8 billion compared to the same month of the previous year. However, they slightly dropped by almost 7% compared to nearly $3 billion in the prior month of March 2024.

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Earlier, SBP Governor Jameel Ahmad projected in January 2024 that overall workers’ remittances would surpass $28 billion in the ongoing fiscal year 2023-24, compared to around $27 billion received in the previous fiscal year 2022-23.

Background information suggests that non-resident Pakistanis managed to send higher remittances in March and April due to Ramazan and Eid festivals falling in these months. Expatriates sent higher funds to their family members to support them against the backdrop of high inflation during Ramazan and Eid.

Secondly, inflows remained high for the second consecutive month in March as overseas Pakistanis continued to send remittances through official channels like commercial banks and exchange companies, unlike their recent practice of partially sending funds through unofficial channels.

The return of stability in rupee-dollar parity and the crackdown on illegal currency markets and illicit traders like hundi-hawala operators encouraged non-resident Pakistanis to maintain sending funds through official channels.