SBP rejects report of $4.9 billion remittance from Pakistan to India
KARACHI: Following dissemination of estimated data suggesting an outflow figure of $4.9 billion from Pakistan to India as remittances, the State Bank of Pakistan (SBP) has taken note of the report.
In a statement by the central bank, it has been said that the report pertaining to estimated remittances figure issued by Global Knowledge Partnership on Migration and Development (KNOMAD). The statement further shed light on the methodology used to estimate the figures based on a World Bank’s Working Paper by Ratha, Dilip, and William Shaw (South-South migration and remittances. No.102. World Bank Publications, 2007) which has several serious flaws, statement added.
It is pertinent to mention that the estimated remittance figure of $4.9 billion was published in Migration and Remittances FactBook 2016 of World Bank (WB).
Moreover, the statement laid emphasis on the figure stating, at the outset, it must be noted that the FactBook 2016 on bilateral remittance flows were merely estimated figures, contrary to actual flows, which are based on a number of assumptions about migrant stock, per worker income, etc.
This methodology has flaws, particularly in case of Pakistan, as it has also been acknowledged by the authors themselves by stating that interpreting the meaning of migrant stocks also presents some difficulties. Pakistanis in India and Russians in Ukraine became migrants following partition of the original country.
Thus the study is clearly flawed as the migrants at the time of Indo-Pak partition in 1947 had become citizens of Pakistan. Therefore, SBP categorically rejects such estimates as these are contrary to facts and do not make sense, the statement added.
The actual balance of payments data shows that outflow of workers’ remittances from Pakistan to India were $116 thousands in Fiscal Year 2016 (FY16) and the inflows from India to Pakistan were $329 thousands.
The value of Pakistan’s exports to India was $425 million, while imports from India amounted to $1,415 million, during FY16.