Bangladesh Defense
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Remittances all-time high of $3.75b
Remittance hit $3.75 billion in March, the highest on record, giving a respite amid deepening worries over the ripple effect on Bangladesh’s struggling economy due to the US-Israel war on Iran.
Remittances all-time high of $3.75b
Expats sent more before Eid in March, offering relief amid concerns over war fallout on economy
Star Business Report
Remittance hit $3.75 billion in March, the highest on record, giving a respite amid deepening worries over the ripple effect on Bangladesh’s struggling economy due to the US-Israel war on Iran.
The inflow in March was 14 percent higher than $3.29 billion in March 2025 as Bangladeshis working abroad sent increased amounts to their loved ones ahead of the Eid-ul-Fitr festival on March 21.
Overall remittance, which acts as a major source for Bangladesh to clear its external payments, rose 20 percent to $26.20 billion in the July-March period compared to a year ago, according to Bangladesh Bank (BB) data released yesterday.
The surge comes against the backdrop of heightening concern over the possible impact of the war on remittances in the coming months as the conflict spreads across the Gulf -- key employment destinations for Bangladeshi migrant workers.
Nearly 800 Middle East-bound flights from Bangladesh have been cancelled since the war with Iran on February 28, mostly affecting migrant workers.
Last week, the Asian Development Bank (ADB), in a report, said Bangladesh and other South Asian countries could face lower remittances from the Middle East as the ongoing conflict in the region weakens labour demand and squeezes migrant worker incomes.
Nearly half of Bangladesh’s more than $30 billion in annual remittances comes from the Middle East. Saudi Arabia, Oman, Qatar, the UAE, and Kuwait together accounted for 86 percent of Bangladeshi migrant workers who secured jobs abroad in FY25, according to the Bangladesh Economic Review 2025.
Bankers and analysts said the spike in the inflow was largely because of the Eid festival, political stability and an increased rate of the US dollar following a slight depreciation of the taka.
Md Shaheen Iqbal, additional managing director & head of wholesale banking at BRAC Bank, said another factor is that migrants try to send home more during any crisis period. “We have seen this trend during the initial days of the Russia-Ukraine war. A similar thing may happen this time.”
He said the inflow may fall this month but recover in the next month ahead of Eid-ul-Azha. However, the remittance inflows in the later months will depend on the war, he said.
Deen Islam, professor of economics at Dhaka University, said the recent surge in remittance inflows provides meaningful short-term relief to Bangladesh’s external sector, but its sustainability remains uncertain in the current global context.
“Much of Bangladesh’s remittance originates from migrant workers in Gulf Cooperation Council (GCC) economies, making flows sensitive to oil price cycles, fiscal conditions in host countries, and evolving labour nationalisation policies,” he said.
“Additionally, tighter immigration regimes in advanced economies and global economic slowdown risks could constrain future migration and earnings growth.”
During the July-February period of the fiscal year 2025-26, over 10 lakh migrant workers left for jobs abroad, up 15 percent YoY, according to official data.
Birupaksha Paul, a professor of economics at the State University of New York, USA, said imports may increase following the return of political stability in the country after the election.
“There is a concern that pressure is likely to build on Bangladesh’s foreign exchange reserves to pay higher import bills,” he said. “Foreign exchange reserves will not increase in that case.”
In this context, he said, the foreign exchange rate should be re-evaluated. “Some people doubt that it is not yet fully market-based and not reflecting the market price,” he said, adding that any depreciation will fuel import-induced inflation.
“But reserve management is a crucial thing,” said Paul, former chief economist at the BB.
Prof Islam said while the increase in remittance strengthens the balance of payments, supports exchange rate stability, and boosts domestic consumption, it also reinforces a structural dependence on external labour income rather than productivity-driven export growth.
“Therefore, although remittances will likely remain a vital pillar of macroeconomic stability in the near term, their long-run sustainability and developmental impact depend on diversification of migration destinations, skill upgrading of workers, and complementary policies to channel inflows into productive investment rather than predominantly consumption.”
Expats sent more before Eid in March, offering relief amid concerns over war fallout on economy
Star Business Report
Remittance hit $3.75 billion in March, the highest on record, giving a respite amid deepening worries over the ripple effect on Bangladesh’s struggling economy due to the US-Israel war on Iran.
The inflow in March was 14 percent higher than $3.29 billion in March 2025 as Bangladeshis working abroad sent increased amounts to their loved ones ahead of the Eid-ul-Fitr festival on March 21.
Overall remittance, which acts as a major source for Bangladesh to clear its external payments, rose 20 percent to $26.20 billion in the July-March period compared to a year ago, according to Bangladesh Bank (BB) data released yesterday.
The surge comes against the backdrop of heightening concern over the possible impact of the war on remittances in the coming months as the conflict spreads across the Gulf -- key employment destinations for Bangladeshi migrant workers.
Nearly 800 Middle East-bound flights from Bangladesh have been cancelled since the war with Iran on February 28, mostly affecting migrant workers.
Last week, the Asian Development Bank (ADB), in a report, said Bangladesh and other South Asian countries could face lower remittances from the Middle East as the ongoing conflict in the region weakens labour demand and squeezes migrant worker incomes.
Nearly half of Bangladesh’s more than $30 billion in annual remittances comes from the Middle East. Saudi Arabia, Oman, Qatar, the UAE, and Kuwait together accounted for 86 percent of Bangladeshi migrant workers who secured jobs abroad in FY25, according to the Bangladesh Economic Review 2025.
Bankers and analysts said the spike in the inflow was largely because of the Eid festival, political stability and an increased rate of the US dollar following a slight depreciation of the taka.
Md Shaheen Iqbal, additional managing director & head of wholesale banking at BRAC Bank, said another factor is that migrants try to send home more during any crisis period. “We have seen this trend during the initial days of the Russia-Ukraine war. A similar thing may happen this time.”
He said the inflow may fall this month but recover in the next month ahead of Eid-ul-Azha. However, the remittance inflows in the later months will depend on the war, he said.
Deen Islam, professor of economics at Dhaka University, said the recent surge in remittance inflows provides meaningful short-term relief to Bangladesh’s external sector, but its sustainability remains uncertain in the current global context.
“Much of Bangladesh’s remittance originates from migrant workers in Gulf Cooperation Council (GCC) economies, making flows sensitive to oil price cycles, fiscal conditions in host countries, and evolving labour nationalisation policies,” he said.
“Additionally, tighter immigration regimes in advanced economies and global economic slowdown risks could constrain future migration and earnings growth.”
During the July-February period of the fiscal year 2025-26, over 10 lakh migrant workers left for jobs abroad, up 15 percent YoY, according to official data.
Birupaksha Paul, a professor of economics at the State University of New York, USA, said imports may increase following the return of political stability in the country after the election.
“There is a concern that pressure is likely to build on Bangladesh’s foreign exchange reserves to pay higher import bills,” he said. “Foreign exchange reserves will not increase in that case.”
In this context, he said, the foreign exchange rate should be re-evaluated. “Some people doubt that it is not yet fully market-based and not reflecting the market price,” he said, adding that any depreciation will fuel import-induced inflation.
“But reserve management is a crucial thing,” said Paul, former chief economist at the BB.
Prof Islam said while the increase in remittance strengthens the balance of payments, supports exchange rate stability, and boosts domestic consumption, it also reinforces a structural dependence on external labour income rather than productivity-driven export growth.
“Therefore, although remittances will likely remain a vital pillar of macroeconomic stability in the near term, their long-run sustainability and developmental impact depend on diversification of migration destinations, skill upgrading of workers, and complementary policies to channel inflows into productive investment rather than predominantly consumption.”
