Remittance flow hits 21-month low
The country received $1.5 billion in February, also 16% lower year-on-year
The remittance flow, which saw an upward trend since the Covid-19 outbreak in the country, has been on the decline, with the pandemic easing.
The country received $1.5 billion in remittances in February, which is the lowest in 21 months, according to the latest data of the Bangladesh Bank. The latest figure is also 16% lower year-on-year.
Compared to January, the remittances fell by 12.2% or about $208 million as expatriates sent $1.70 billion in remittances in that month, said the central bank data published on Tuesday.
Earlier in May 2020, Bangladesh received $1.09 billion in remittance.
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The government set a remittance target of $26 billion for the current fiscal (FY2021-22). However, the remittance fell far short of the target in the first eight months.
"The expatriate Bangladeshis sent their saved money home at the beginning of the pandemic crisis. Now, the inflow of remittance has decreased as the Covid-induced difficulties eased," said Professor Mustafizur Rahman, distinguished fellow at the Centre for Policy Dialogue.
However, many were sending money through hundi thanks to higher dollar rates in the informal channels, which is not being added to the official remittance figures, he told The Business Standard.
"Besides, some dollars are now being used outside the country as many people are travelling to other countries and paying tuition fees to foreign universities for their children amid the reopening."
Mustafiz, however, is hopeful that the inflow of remittance would increase at the end of this fiscal as a huge number of workers went abroad recently and they would start sending money soon.
In the first eight months of the current financial year, remittances reached $13.44 billion which is only 52% of the fiscal target. It was $16.69 billion in the corresponding period of the previous year.
To increase the remittance flow to the country, the government recently increased the incentive facility against received remittance to 2.5%, from the earlier 2%.
Talking to TBS, Mohammad Abul Bashar, former president of the Bangladesh Association of International Recruiting Agencies, said the remittance inflow would substantially increase in future.
"The Malaysian labour market reopened after three years. Many will migrate to the country. Besides, more opportunities are coming day by day."
For example, a record number of 1.31 lakh workers went to different countries in December last year, he said, adding that remittance from the Middle East countries would increase as their economies saw a boom with the hike of oil prices.
"We hope the remittance flow would increase substantially on the occasion of upcoming Ramadan and Eid," said Sirajul Islam, spokesperson of the central bank.
Another reason behind the drop in February's remittance was that the month consisted of 28 days, he told The Business Standard.
Bangladesh received $22.07 billion in remittance in 2021, $21.74 billion in 2020 and $18.33 billion in 2019.
