Pre-Eid remittances jump despite war fears
Remittance inflows to Bangladesh have increased notably in the run-up to Eid-ul-Fitr, providing support to the country’s external sector despite growing geopolitical uncertainty in key labour destination markets.
According to the latest central bank data, Bangladesh received nearly US$2.50 billion in remittances during the first 15 days of the month. Inflows totalled $2.44 billion over the period, representing a 47.10 per cent increase from $1.66 billion recorded in the same period a year earlier.
Officials at Bangladesh Bank (BB) attributed the rise largely to seasonal factors, as expatriate workers typically send higher amounts to support their families ahead of Eid. Remittance inflows have so far remained stable despite escalating tensions in the Middle East following recent military developments involving the United States, Israel and Iran.
“The higher inflow reflects advance planning by expatriates ahead of Eid,” a senior BB official said, adding that remittances have yet to face any significant disruption. However, he noted that the effects of the ongoing tensions could become apparent in the coming months if the situation persists.
In a quarterly report released on Monday, the central bank indicated that remittance growth may moderate due to possible disruptions in overseas employment and economic uncertainty in host countries.
“Although inflows remain strong, supported by a large stock of migrant workers, growth could slow due to migration disruptions and uncertain economic conditions in destination countries,” the report said.
The report added that the extent of any impact would depend on the duration and geographical spread of the conflict. A short-lived episode is likely to have limited effects, whereas a prolonged regional crisis could weaken remittance inflows and increase pressure on Bangladesh’s external sector.
Bangladesh Bank also pointed to broader risks arising from higher global commodity prices. Rising tensions in the Gulf have contributed to increased costs of oil, liquefied natural gas (LNG), fertiliser and sulphur, partly linked to Iran’s control over the Strait of Hormuz, a key route for global energy supplies.
Travel disruptions have further affected labour mobility, with more than 600 flights from Bangladesh to Middle Eastern destinations reportedly cancelled, impacting migrant workers.
Bangladesh’s overseas employment remains heavily concentrated in the Middle East. Since FY2014–15, around 8.6 million Bangladeshis have migrated for work, with Saudi Arabia accounting for nearly half.
Around 75 per cent of overseas employment is based in countries such as Saudi Arabia, Oman, Qatar, the United Arab Emirates and Kuwait, which together contribute nearly half of the country’s annual remittance inflows of over $30 billion.
Despite these risks, remittance inflows have maintained steady growth in recent months. Receipts rose by 20 per cent year-on-year to $8.67 billion during the October–December quarter of FY26, supported in part by policy measures encouraging the use of formal channels.
Saudi Arabia remained the largest source of remittances, accounting for 15 per cent of the total, followed by the United Arab Emirates with 13.54 per cent.
The central bank reiterated the importance of remittances in strengthening foreign exchange reserves, supporting macroeconomic stability and easing external sector pressures. It also noted that the contribution of remittances to GDP has been increasing, with the remittance-to-GDP ratio estimated at 7.66 per cent in the second quarter of FY26.
While the pre-Eid rise in inflows has provided short-term support, policymakers remain cautious, noting that sustained growth will depend on an easing of geopolitical tensions in the Middle East.
