Islamabad, January 10, 2025: Prime Minister Shehbaz Sharif has lauded the record-breaking $3.1 billion in remittances received in December 2024, marking a 29.3% year-on-year increase and a 5.6% rise compared to November. The Prime Minister described this surge as a testament to the unwavering commitment of overseas Pakistanis to their homeland and their crucial role in strengthening Pakistan’s economy.
“Record growth in foreign remittances demonstrates the deep bond of overseas Pakistanis with their country. Their contributions are pivotal to Pakistan’s economic stability and progress,” he stated. The Prime Minister emphasized that Pakistan is firmly on the path to economic recovery, with the government dedicated to national development and public welfare.
Impressive growth in FY2024-25
Data from the State Bank of Pakistan (SBP) shows that remittances during the first half of FY2024-25 (July-December) reached $17.8 billion, a 32.8% increase compared to $13.4 billion in the same period last year.
Key factors driving growth
The surge in remittances is attributed to:
- Reforms: Measures to curb illegal foreign exchange trading and incentives for formal banking channels.
- Currency Stabilization: Reduced disparity between interbank and open market rates.
- Digital Infrastructure: Improved payment systems facilitating faster and more secure transactions.
- Global Trends: Lower inflation in key host countries and increased earnings for Pakistani workers abroad.
Economist Dr. Khaqan Najeeb noted that these factors, coupled with the expanding Pakistani diaspora, have significantly boosted formal remittance channels. “Stabilizing the exchange rate, higher earnings in destination countries, and enhanced digital infrastructure have played a vital role in increasing remittance flows,” he explained. Dr. Najeeb added that remittances have been instrumental in managing Pakistan’s external accounts amid domestic inflationary pressures.
Top remittance sources
The bulk of December 2024 remittances received from:
- Saudi Arabia: $770.6 million
- United Arab Emirates: $631.5 million
- United Kingdom: $456.9 million
- United States: $284.3 million
Other significant contributions were received from Gulf Cooperation Council (GCC) countries, including Oman ($108.5 million), Qatar ($89.2 million), Kuwait ($71.1 million), and Bahrain ($41.2 million).
Remittances remain a critical source of external financing for Pakistan, enhancing foreign exchange reserves and supporting the balance of payments. The government and SBP expect remittances to reach a record $35 billion by the end of FY2024-25, reflecting increased confidence in Pakistan’s economic trajectory.
Prime Minister Shehbaz Sharif reaffirmed the government’s commitment to fostering economic growth and improving the welfare of Pakistanis at home and abroad. He called on the diaspora to continue their invaluable contributions, which are vital to Pakistan’s ongoing economic recovery and future development.
