The new government is heavily relying on foreign remittances to bridge the gap in the ailing economy. It is great to see the government wanting to regulate the mechanism of remittances to ensure that the money is accounted for and has a proper channel established for accountability and keeping a record of these transactions. It has recently been established by the FATF investigation team that the financial channels in the country need to be more secured and tied up to several institutions which crosscheck each other’s work, allow a steady flow of cash, and also keep a track on any illegal activity.
These financial regulations will be greatly beneficial for the society as a whole and not just for the remittance network. Banking channels need to be empowered to manage such a cash flow and the incentives offered to the foreign Pakistanis will encourage them to send money back home. Since the last two elections, foreign Pakistanis have missed out on the opportunity of voting in the general elections but this way, they will be able to contribute to their economy and that is a start good enough for them at this point.
While the government is focusing on finding official means to regulate the money flowing into the economy, another area of focus is also the unofficial means of cash transfer. The biggest problem that successive governments have faced is not the introduction of official policies, rather getting people to give up their traditional unofficial and informal ways. This will require rigorous campaigning and trust building measures to ensure that the money coming in will be safe via the channels it moves into the economy. The legal reforms in civil and criminal laws is a good start for the government and this will also boost up their confidence as the policies will materialise into concrete evidence of improvement.
Source:Â https://nation.com.pk/14-Oct-2018/foreign-remittances
