Karachi: remittance tickets are higher than ever and exchange companies alone could accumulate $ 5 billion at the end of Ramazan, exchange companies said on Saturday.
“We have already sold $ 3.5 to $ 4 billion to the banks during the first 8 months of fiscal year 2015, while Ramazan would add more to the total,” said Zafar Paracha, general secretary of the Association of Pakistan Exchanges Companies.
The country received $ 20.9 billion in remittances in July to January 2015 compared to $ 15.8 billion a year ago, up to 32.27pc, exceeding the growth projection of $ 5 billion for fiscal year 2015 in the first seven months.
“We are sure that at the end of Ramazan we could sell $ 5 billion to the banks, which would be a great achievement,” Paracha said.
Exchange companies have been asking the government to facilitate Pakistani abroad to boost tickets instead of distributing exporters subsidies.
However, the strong lobby of exporters is obtaining benefits, but has failed to increase any significant increase, while remittances have already exceeded export income.
“We are sure that more incentives and some changes in policies could double remittances,” Paracha said.
Some experts in the monetary market questioned the Government’s wisdom when putting the country under the GLOs of the IMF for a $ 7 billion rescue package. A forensic audit of the economy is being carried out by a visiting mission of the IMF to decide the release of the second section of $ 1.1 billion under the installation of extended funds.
“The IMF will provide $ 7 billion in 37 months, while Pakistani abroad provide $ 35 billion in a year,” said an expert in the market, requesting anonymity.
“These Pakistani should receive more attention than the IMF,” said the owner of an exchange company. The largest remittance entries have stabilized the exchange rate and helped the state bank to maintain foreign exchange reserves buying dollars in the interbank market. The SBP bought around $ 3.8 billion of banks in the first four months of the current fiscal year.
Historically, the Central Bank buys dollars to maintain substantial reserves to stabilize the exchange rate. However, experts in the money market said that the amount collected by the SBP is too large compared to the commercial loans that the country has made during the period.
Parach said the average monthly tickets through exchange companies during the first 8 months of the current fiscal year were $ 400 to $ 450 million.
One of the key reasons for the highest remittances was the repression of the government against illegal currency companies. At the same time, money laundering has also decreased, a foreign exchange expert said.
Posted in Dawn, March 9, 2025
