Kazi Zahidul Hasan :
The Kingdom of Saudi Arabia (KSA) and the United States of America (USA) remained the biggest sources of remittances to Bangladesh with more than $9.0 billion transferred to the South Asian nation from the Gulf and North American country in the fiscal year 2020-21.
In the fiscal year 2020-21, Bangladesh received $5.71 billion remittances from the KSA and $3.46 billion from the USA, according to Bangladesh Bank data.
Saudi Arabia is the single largest destination for Bangladeshi migrant workers and more than two million of them are living in the Kingdom, according to media reports.
Besides, Bangladeshi Americans are one of the fastest growing Asian origin groups in the United States with their number surging 263 per cent over the past two decades from just 57,000 in 2000 to 208,000 in 2019, according to US Census Bureau data.
During the first seven months of the current fiscal year (July to January 2022), remittances from overseas Bangladeshis reached US$ $11.94 billion, 20 per cent lower than the corresponding period last year.
Remittance inflows during the period were mainly sourced from Saudi Arabia, the US, the UK and the UAE.
The expatriates sent $1871.49 million in remittances in July, $ 1810.10 million in August, $ 1726.71 million in September, $ 1646.87 million in October, $1553.70 million in November, $1630.66 million in December and $1704.45 million in January of the current fiscal year (FY22).
The top four countries that contributed to the highest remittance inflows during July to January 2022 are as follows:
1. Saudi Arabia (US$2.79 billion)
2. United States (US$1.97 billion).
3. United Kingdom (US$1.07 billion)
4. Kuwait (US$971.44million)
Remittances inflows from other Gulf Cooperation Council (GCC) countries including UAE, Bahrain, Oman and Qatar were US$2.61 billion.
Meanwhile, Bangladeshis in Italy remitted an amount of US$596.37 million, in Malaysia US$ 600 million and Singapore US$ 233.82 million.
Bangladesh’s remittance earnings reached record high of $22.07 billion in the fiscal year 2020-21 despite economic slowdown in the host countries of Bangladesh’s migrant workers amid coronavirus pandemic. The amount of remittances the country received in the previous fiscal year (2019-20) was $21.74 billion.
“Proactive policy measures to incentivise the use of formal channels amid the Covid-19 pandemic had contributed toward record inflows of remittances last year,” said a BB official.
“Remittance inflow hit a record high last fiscal year due to the government policy on remittances sent by Bangladeshi migrant workers. Migrant workers were encouraged to send money through formal channels since in July 2019 a 2.0 per cent cash incentive was put in place on remittances sent from overseas,” said Dr Mustafizur Rahman, Distinguished Fellow, Centre for Policy Dialogue (CPD).
It should be noted that the government allocated Tk 30.60 billion in FY 2020-21 budget for payment of incentives on remittances.
Recently, the Finance Ministry increased the incentive on the remittance exchange rate to 2.5 per cent from the previous 2 per cent amid fall in money transfers from Bangladeshi migrant workers.
Terming the government’s move ‘praiseworthy,’ Dr Mustafizur Rahman said, “It may help sustain Bangladesh’s remittance flows which is necessary to keep the country’s foreign exchange reserve stable in wake of soaring import bills.”
He added that the government can think about more incentive on remittance considering its contribution on the national economy.
