Sajjad Azhar:
As fears of a prolonged conflict in the Middle East grow, its economic aftershocks are already being felt in Pakistan—particularly in the overseas employment sector that sustains millions of households and supports the national economy through remittances.
Muhammad Hasnain, a young resident of Attock district, represents the human face of this unfolding crisis. Having secured a factory job in Saudi Arabia after taking a loan, he was preparing to depart and support his eight-member family. His ticket was confirmed, and his luggage packed. But just hours before his flight, he was told not to go to the airport. The company that had hired him abruptly suspended worker arrivals until the situation stabilises. Now, Hasnain is trapped in uncertainty—jobless and burdened with debt repayment.
His predicament mirrors that of thousands of Pakistanis whose overseas employment plans have been put on hold despite having completed all necessary documentation. Beyond them, more than nine million Pakistanis currently working in Gulf countries face an even greater risk: job losses if the conflict escalates or persists.
Remittances are not merely an economic indicator for Pakistan—they are a lifeline. During the last fiscal year, Pakistan received $38.3 billion in remittances, marking a 26% increase compared to the previous year. A significant 54.1% of this—around $20.7 billion—came from Gulf countries alone, underlining the country’s heavy reliance on the region.
This dependence becomes even more critical when viewed against Pakistan’s broader economic structure. The country’s exports stood at $32.1 billion, while imports surged to $58.38 billion, resulting in a trade deficit of over $26 billion. With foreign direct investment remaining limited, remittances play a decisive role in bridging this gap and stabilising foreign exchange reserves. Any disruption to this inflow could trigger currency depreciation, intensify inflation, and deepen economic instability.
Data from the Bureau of Emigration and Overseas Employment reveals that between 2011 and 2025, nearly 10 million Pakistanis went abroad for work, with about 90% heading to Gulf countries. Saudi Arabia alone hosts over half of these workers, followed by the United Arab Emirates, Oman, Qatar, Bahrain, Kuwait, and Iraq. These migrant workers not only sustain their families but also form the backbone of Pakistan’s external financial inflows.
The importance of overseas employment is further underscored by Pakistan’s demographic realities. The country has one of the youngest populations in the world, with over 40% comprising youth. Each year, around two million young people enter the job market, yet the domestic economy struggles to absorb them. For many, migration to the Gulf is not just an opportunity but a necessity.
Experts caution that the immediate impact of a prolonged conflict on Pakistan’s labour market could be severe. Estimates suggest that between 114,000 and 228,000 workers may be unable to travel abroad this year due to disruptions. If conditions worsen, this number could rise to 380,000, and in an extreme scenario, even reach 1.4 million. Such a situation would not only increase unemployment domestically but also reduce remittance inflows by an estimated $4.3 billion.
The economic fallout would not stop there. Pakistan’s exports to the Middle East—already accounting for around 11% of total exports—are being affected. Meanwhile, global oil prices have surged by up to 50% due to rising tensions. If key supply routes such as the Strait of Hormuz remain disrupted, oil prices could climb to between $120 and $150 per barrel. This would significantly raise Pakistan’s monthly oil import bill, potentially pushing inflation from the current 7% to as high as 17%.
For Pakistan, therefore, the stakes are extraordinarily high. The ongoing conflict is not just a distant geopolitical issue—it is a direct threat to the country’s economic lifeline. If remittance flows are disrupted and overseas employment declines, the consequences could be devastating, affecting everything from household incomes to national financial stability.
In a country already facing economic challenges, the continuation of war could turn a fragile situation into a full-blown crisis.
197
