UAE Remittances to Bangladesh Plunge 47% Amid Regional Tensions

Inward remittances from the United Arab Emirates to Bangladesh plummeted by approximately 47% in October, leading a wider contraction in financial transfers from the Gulf region. Latest figures from Bangladesh Bank confirm that formal inflows from the UAE dropped to $189.53 million in October, down from $361.93 million recorded in September. Regional Contraction and Currency Trends The decline extends beyond the UAE, with Qatar and Bahrain also reporting significant reductions in official remittance volumes. Transfers from Qatar fell to $81.79 million in October from $103.49 million the previous month. Similarly, Bahrain saw a decrease from $43.83 million to $34.79 million. This collective downturn from major Middle Eastern labor markets has triggered concerns over the stability of foreign exchange reserves in Dhaka. Economic analysts attribute the sharp decline to a combination of rising living costs for expatriates and the resurgence of informal money transfer channels, known as hundi. Despite a 2.5% government incentive on formal transfers, the widening gap between the official interbank exchange rate and the open market rate has incentivized workers to bypass traditional…