Saudi Arabia, UAE drive Pakistan remittances to record $41.6bn

Dubai: Pakistan received a record $41.6 billion in workers’ remittances during fiscal year 2025-26, with Saudi Arabia and the United Arab Emirates accounting for nearly half of the total inflows, underscoring the Gulf’s continued importance to the country’s economy and external finances.

Data released by the State Bank of Pakistan (SBP) on Thursday showed remittances rose 8.6% year-on-year from $38.3 billion in FY25. Saudi Arabia remained the largest source of inflows, contributing $9.78 billion, followed by the UAE at $8.81 billion, the United Kingdom at $6.33 billion and European Union countries at $5.23 billion.

Monthly remittances stood at $3.5 billion in June, up 2% from the same month last year but 18.3% lower than May’s record $4.25 billion, which analysts attributed to a high base following Eid-related transfers.

In June alone, Saudi Arabia remained the biggest source of remittances, with overseas Pakistanis sending $829.6 million, followed closely by the UAE at $792.2 million. The UK contributed $514.9 million, while remittances from the United States totalled $296.8 million.

Khurram Shehzad, adviser to Pakistan’s prime minister, described the annual inflow as a historic milestone.

“This historic milestone reflects the unwavering confidence of overseas Pakistanis and reinforces Pakistan’s external sector resilience, stronger foreign exchange buffers and improving macroeconomic fundamentals,” he tweeted.

Dr Khaqan Najeeb, former adviser to Pakistan’s Ministry of Finance, said the record remittance inflows continued to provide a crucial cushion for the country’s external sector. “Workers’ remittances remained a key source of external sector resilience in FY2025-26, reaching a record $41.6 billion, up 8.6% over the previous year,” he said.

“While inflows eased to $3.5 billion in June due to seasonal factors, they still grew 2% year-on-year, reflecting the continued support of overseas Pakistanis.” He added that Pakistan must boost exports, productivity and investment to ensure remittances complement a more competitive, investment-led economy.

The strong remittance performance comes as Pakistan’s external sector continues to improve. SBP Governor Jameel Ahmad said the country’s current account was expected to post a slight surplus for FY26, supported by robust remittances and services exports despite higher imports.

For the first 11 months of FY26, Pakistan recorded a current account surplus of $255 million, with final figures for the fiscal year expected to remain in positive territory.