Pakistan has received nearly $30 billion in worker remittances in fiscal year 2020-21, according to the State Bank of Pakistan. This is a new record representing about 10% of the country's gross domestic product (GDP). This money helps the nation cope with its perennial current account deficits. It also provides a lifeline for millions of Pakistani families who use the money to pay for food, education, healthcare and housing. This results in an increase in stimulus spending that has a multiplier effect in terms of employment in service industries ranging from retail sales to restaurants and entertainment.
|Overseas Pakistani Workers' Remittances. Source: Arif Habib
Pakistan's share of working age population (15-64 years) is growing as the country's birth rate declines, a phenomenon called demographic dividend. This dividend is manifesting itself in high levels of worker exports and record remittances pouring into the country. Saudi Arabia and the United Arab Emirates(UAE) are the top two sources of remittances but the biggest increase (58%) in remittances is seen this year from Pakistanis in the next two sources: the United Kingdom and the United States.
|Pakistani Workers Going Overseas. Source: Bureau of Emigration
|Projected Population Decline in Emerging Economies. Source: Nikkei Asia
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