Overseas Pakistanis send more money home during Ramadan

PESHAWAR – Pakistanis’ desire to keep their spiritual obligations during the holy month of Ramadan means an upsurge in remittances, but some caution Pakistani Muslims to carefully choose the groups they support.

“On an average basis, Pakistan receives $1.1 billion (Rs. 104.2 billion) in remittances every month from its overseas Pakistanis, but in Ramadan the figure rises to $1.3 billion (Rs. 123.1 billion),” Mohammad Tariq Khan, head of the foreign exchange department, Bank of Khyber, told Central Asia Online July 23.

Pakistanis living abroad, he said, typically send more money back home during Ramadan to help their families shop for Eid-ul-Fitr, the three-day annual celebration that follows Ramadan.

“We happen to have quite a rush of customers in the closing days of Ramadan as a large number of people send money back home ahead of the Eid festival,” said Amjad Khan, a co-owner of the Gold Currency Exchange at Peshawar’s Chowk Yadgar Currency Market.

Donations go to Eid shopping, philanthropic causes

But not all the money sent home during Ramadan is destined for Eid shopping, however. A large part goes to buy food for destitute families, as Islamic religious organisations step up their charity programmes.

“We distribute 200 to 300 food packages among as many families at all of our stations,” Rahimullah, a Peshawar-based representative of Muslim Hand, told Central Asia Online.

Muslim Hand is a UK-based international Islamic relief agency that works in 50 countries, including Pakistan.

A sizeable number of expatriate Pakistanis living in Europe, especially in the UK, donate money to Muslim Hand to support its good works.

“Ramadan makes a special occasion as several people donate money to support needy families and orphans,” Rahimullah said.

Fraudulent collection is a problem

But Muslims’ generosity during Ramadan opens the door to unscrupulous groups eager to take advantage.

Banned outfits such as Jaish-e-Muhammad and Jamaat-ud-Daawa (JD), for example, operate Pakistani-based Islamic welfare organisations. While those subsidiaries contend that they indeed help needy Pakistanis, officials and analysts assert that much of their fund-raising goes to support militant training and activities.

“We spend charity money in line with our donors’ preferences,” said Atiq Chauhan, a Peshawar-based JD spokesman, adding “we have a Jihad fund … and the Jihad fund money is used to finance field operations in Kashmir.”

Still, some Taliban-affiliated groups pose as charities but use the money to fund militant training and operations against the government and anti-militant citizens in Khyber Pakhtunkhwa and the Federally Administered Tribal Areas.

Working to curtail militant groups’ collections

The militant-affiliated groups seem to be having a harder time collecting funds this Ramadan, thanks in part to stricter controls.

For example, the State Bank of Pakistan, after the 9/11 attacks, moved to prohibit the centuries-old informal credit/money transfer systems of hawala and hundee in an effort to curb funding to terrorist groups.

Although hundee, in which the payer hands cash to a representative in a foreign country, whose business associate in Pakistan delivers the same amount the next day to the sender’s recipient, still exists, today’s policies mean an overwhelming number of remittances are transferred to Pakistan through money exchange companies, Pakistani banker Tahir Khan said.

The bank’s Pakistan Remittance Initiative system has helped the government to keep an eye on money transactions between terrorist groups, according to Khan.

And Pakistan has been monitoring currency exchange companies, he said. For example, two Afghan money exchanges – the Haji Khairullah Haji Sattar Money Exchange and the Roshan Money Exchange – known to support the Afghan Taliban have been banned in Pakistan, Khan said, citing recent media reports.

Changes apparently yield results

Those controls seem to be doing the job of making it more difficult for militant groups to raise money.

Falah-e-Insaaniyat, a welfare subsidiary of JD, arranges Ramadan meals – iftars at dusk and seherees early in the morning – for thousands of faithful in Peshawar, Lahore, Islamabad, and elsewhere in Pakistan, according to Chauhan.

“We have a Bank Al-Falah account for collecting donations,” Chauhan said, adding “in several instances expatriate Pakistanis, too, donate money for our Ramadan welfare programmes.”

However, according to him, the organisation relies more on the Pakistani business community.