KARACHI: Pakistan’s remittances from its overseas workers increased to $3.5 billion in April, a 11.4 per cent rise year-on-year (YoY), the central bank said on Monday.
However, on a month-on-month (MoM) basis, remittances dropped by 7.6 per cent.During the first 10 months of the fiscal year 2026, Pakistani citizens employed abroad sent home a total of $33.9 billion. This amount reflects an 8.5 per cent increase compared to the same period in FY25.
Remittance inflows have remained resilient despite an uncertain external environment amid shocks from the ongoing war in the Middle East. The regional tensions and the closure of the Strait of Hormuz are putting enormous pressure on the country, which heavily relies on imported fuel and gas. However, the continued strong flow of funds from migrant workers helps stabilise the currency, supports foreign exchange reserves, covers the basic needs of millions of families, cushions the impact of a widened trade deficit, and keeps the current account balance in check.
Remittance data follows the International Monetary Fund’s approval of approximately $1.32 billion in new funding under the two ongoing loan programmes. “The MoM comparison shows a decline of 8.0 per cent, which is normal seasonal behaviour as the post-Ramazan/Eid surge moderates,” said Waqas Ghani, head of research at JS Global.
“However, the 11 per cent YoY [increase] signals robust underlying demand for formal remittance channels and continued emigration-driven inflows,” Ghani added.“As external pressures re-emerge, remittances are becoming increasingly critical,” he said.
He mentioned that the current account balance settled at $8 million in the nine months of FY26, rescued by the blockbuster March surplus of $1.07 billion, driven by a seasonal remittance surge ahead of Eid and an improved trade balance.
“The trade gap during nine months of FY26 expanded 26 per cent YoY to $23.5 billion, with imports rising 8.0 per cent YoY while exports slipped 6.0 per cent YoY, keeping the underlying external position structurally weak,” Ghani said.
Typically, remittance inflows see seasonal increases around the time of Eid festivities. With Eidul Azha approaching at the end of this month, overseas citizens are expected to send more money to their families to fulfil the religious obligation of sacrificing animals. However, if these inflows slow down, particularly from Gulf countries due to the fallout from the Iran war, analysts fear Pakistan’s external account could again face a deficit.
Any changes in the labour market, especially a preference for hiring local workers, could jeopardise the remittances. There are growing reports of workers from the Gulf being sent back, although no specific numbers or data are available at this time.
Last month, the State Bank of Pakistan revised its remittance forecast for FY26, lowering it to $41 billion from the previous projection of $42 billion. Remittances stood at $38 billion in FY25. Last month, the SBP also projected that its FX reserves would exceed $18 billion by the end of this fiscal year. However, the reports citing the central bank governor, Jameel Ahmad, during a session with the National Assembly’s Standing Committee on Finance and Revenue last week, indicated that the reserves would likely reach over $17 billion, enough to cover three months’ worth of imports.
