PAKISTAN has achieved a quantum jump in home remittances by overseas Pakistanis, the amount of which is increasing with the passage of time partly because of global developments and partly because of measures taken by the banking sector to ensure quicker disbursement of the money. But experts point out that the amount could go even double in foreseeable future if the Government addresses the problems confronting the forexbusiness.
Chairman of the Forex Association of Pakistan Malik Bostan has pinpointed high taxes and complicated procedures as problems that help promote Hawala system or informal channels for money transfer. The State Bank of Pakistan (SBP) has fixed the target of over $13 billion of home remittances for the current year as against $12 billion for the last financial year. Overseas Pakistani workers remitted an amount of $6.3 billion in the first half July-December 2011 of the current fiscal year 2011-12, showing an impressive growth of 19.54 percent or $1 billion when compared with $5.2 billion received during the same period last year. Analysts say the pace of remittances has accelerated sharply over the past couple of years because of a crackdown on the illegal Hundi and Hawala money transfers, swift processing and other facilitation measures introduced by banks and exchange firms and the narrow gap between exchange rates in the open and inter-bank markets. In the face of dwindling foreign assistance, home remittances assume critical position in our economy necessitating the need for taking urgent measures that could give a boost to them. Apart from further improving the banking system, there is point in the demand made by Malik Bostan that exchange companies be provided level playing field. Similarly, incentives should also be given to Pakistanis who have billions of dollars in overseas banks to repatriate the money back to the country and invest it in profitable ventures. But for this to happen, apart from ensuring political stability, attractive fiscal and economic incentives will have to be offered
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