Pakistan records surge in workers' remittances to $3.1 billion in February

Workers' remittances to Pakistan recorded an inflow of $3.1 billion in February 2025, marking a significant increase, according to official data.

On a year-on-year basis, remittances grew by 38.6%, while on a month-on-month basis, they rose by 3.8%. Cumulatively, during the July-February period of the fiscal year 2025, remittances reached $24.0 billion, a 32.5% increase compared to $18.1 billion recorded in the same period of the previous fiscal year.

The bulk of February's remittance inflows came from Saudi Arabia ($744.4 million), the United Arab Emirates ($652.2 million), the United Kingdom ($501.8 million), and the United States ($309.4 million).

An analyst at Arif Habib Limited noted that the surge in remittances is poised to significantly strengthen Pakistan's external account, with projections estimating total remittances for FY25 to reach $36.6 billion.

The analyst further highlighted several contributing factors, including the stabilization of the Pakistani rupee against the U.S. dollar and the narrowing of the exchange rate spread between the interbank and open markets. These developments have encouraged the use of formal channels for fund transfers.

Additionally, a decline in interest rates to 12% and the resolution of the backlog in dividend payments are expected to normalize the primary deficit, which had risen by 56% year-on-year in FY24. The increasing number of Pakistani workers moving abroad has also played a crucial role in bolstering remittance inflows.

These positive trends are anticipated to support Pakistan's overall economic outlook as the country navigates its financial challenges.