Remittances Thrust and Microfinance Schemes: Increasing Trend of Pakistan

Islamabad, Pakistan | February 22, 2008 by D-8 Secretariat

Remittances sent home by overseas Pakistanis continued to show a rising trend as an amount of $3,066.33 million was received in the first half of the current fiscal year 2007-08, showing an increase of $498.31 million or 19.40 percent over the same period of the last fiscal year, reported by media source in Pakistan.

Chief Spokesman of State Bank of Pakistan Syed Waseemuddin says; the amount of $3,066.33 million includes $1.12 million received through encashment and profit earned on Foreign Exchange Bearer Certificates (FEBCs) and Foreign Currency Bearer Certificates (FCBCs).

The monthly average remittances for the period July-December, 2007 comes out to $511.06 million as compared to $428.00 million during the same corresponding period of the last fiscal year, registering an increase of 19.40 percent.

The inflow of remittances in the July-December, 2007 period from USA, Saudi Arabia, UAE, GCC countries (including Bahrain, Kuwait, Qatar and Oman), UK and EU countries amounted to $874.21 million, $563.06 million, $500.33 million, $457.21 million, $227.23 million and $88.99 million, respectively as compared to $659.27 million, $483.32 million, $397.03 million, $358.58 million, $218.67 million and $74.89 million, respectively in the July-December, 2006 period.

Remittances received from Norway, Switzerland, Australia, Canada, Japan and other countries during the first half of the current fiscal year 2007-08 amounted to $354.18 million as against $374.92 million in the same period last year.

During the last month (December 2007), Pakistani workers remitted an amount of $479.26 million, up $4.05 million or 0.85 percent when compared with an amount of $475.21 million sent home in December 2006.

The inflow of remittances into Pakistan from most of the countries of the world increased last month as compared to December, 2006. According to the break up, remittances from USA, Saudi Arabia, UAE, GCC countries (including Bahrain, Kuwait, Qatar and Oman), UK.

Realising the significance of this sector, D-8 Organisation through its secretariat since early last year has been working on a concentrated initiative to set up a D-8 working group on this issue to help member countries to better route this potential remittance for the development of the D-8 member countries. “Due to their large number of populations, our member countries are among the big supplier of migrant worker until now, and it is our utmost interest to seek the best mechanism to channel this resources to the systematised efforts to reduce and eliminate poverty, such as agricultural-aid programs, small-micro investment funds, institutionalisation of the micro-financial system in remote villages, and the improvement of remittances services for poor people,” said D-8 Secretary General, Dr. Dipo Alam.

Microfinance schemes to cut Unemployment Rate

On the other hand, Pakistani Prime Minister Muhammadmian Soomro on Thursday termed unemployment in the country a big challenge which he said could be reduced through investment-friendly policies and providing micro-finance loans to skilled people. He was speaking at inaugural ceremony of new academic block at University of Arid Agriculture, foundation-laying of three mega projects and distribution of micro-credit loan cheques to deserving people.

Soomro said micro-finance had a greater impact on the economic uplift of people by providing them employment. He said State Bank had also been asked to involve other banks for initiating micro-credit schemes to reduce unemployment rate.

He appreciated the microfinance scheme, which was initiated three years back by Governor Punjab Lt Gen (retd) Khalid Maqbool in collaboration with Bahria Town and was being run through Sociology department of the university. He stressed on promoting quality education designed on modern principles for competing in the world. He said the government was focussing on elementary education for a student’s stronger educational foundation besides encouraging higher education.

The Prime Minister appreciated Arid University’s faculty for attaining a standard at par with other prestigious institutions of the country in a short span of time. He distributed cheques of micro-credit loans among 160 people from Potohar area to help them earn livelihood through small businesses.

Governor Punjab Lt Gen (retd) Khalid Maqbool said the microfinance scheme run by the Arid University was benefitting thousands of entrepreneurs. He said through the support of Higher Education Commission, millions of rupees had been incurred on big educational projects in the university. Dr Khalid Mehmood, Vice Chancellor of the university said development projects worth Rs 486.211 millions had been completed while with Rs 1446.124 million were being executed in the academia.

About the micro-credit scheme, he said the interest free loan ranged from Rs 15,000 to 25,000. In last three years, more than 1000 entrepreneurs had benefitted from the scheme while an amount of Rs 17.45 million was being disbursed with 85 percent recovery rate.

Earlier, the Prime Minister inaugurated the new academic block costing Rs 49.5 million in the university premises and laid foundation-stone of three mega projects including Faculty of Veterinary and Animal Sciences with Rs 468.620 million, Institute of Biochemistry and Biotechnology with Rs 358.619 and Development of On-farm Student Research Facilities with Rs 343.224 million.

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