Bangladesh, which depends heavily on remittances from the Middle East, is slowly losing its footing there, raising worries about falling inflows and bigger risks ahead.
After the fall of the Hasina government in 2024, remittance inflows initially surged to record highs, but recent trends show the flow is shrinking, particularly from Saudi Arabia, the United Arab Emirates, Kuwait, Qatar, Oman and Bahrain.
According to the latest Bangladesh Bank data, remittances stood at $2.42 billion in August, down from $2.47 billion in July and $2.82 billion in June.
Year-on-year figures still reflect growth, but the recent downward trajectory points to the turbulence in Middle Eastern markets as a key driver.
“Bangladesh’s labour market in the Middle East is tightening. These countries are increasingly recruiting skilled workers from India and Nepal. On top of that, the aftermath of the Iran-Israel war and the recent Israeli attacks in Qatar have also had repercussions. All these regional instabilities are directly affecting Bangladesh’s economy,” said Mahfuz Kabir, Research Director at the Bangladesh Institute of International and Strategic Studies (BIISS).
Forced merger of five Shariah banks in Bangladesh faces daunting challenges
Saudi Arabia remains Bangladesh’s single largest source of remittances, hosting nearly three million Bangladeshis.
More than 628,000 workers migrated there in 2024 alone, according to the Bureau of Manpower, Employment, and Training (BMET). Yet, despite the sheer numbers, opportunities are shrinking, leaving many migrants struggling to survive and remit.
Every year, tens of thousands return from Saudi Arabia after failing to secure stable work. The Wage Earners’ Welfare Board reported over 50,000 workers were forced to return in 2024 through the “outpass” process, compared to 58,000 in 2023.
Many migrants spend large sums to secure jobs, only to face months or years without proper employment or residency permits (aqama).
Ebaydul Islam from Jhalakathi, who returned from Saudi Arabia last year, shared his ordeal, “I was promised an aqama within three months. Even after a year, it never came. The job I was promised never materialized either. I had to live like an undocumented worker, hiding every day.”
Another returnee, Mirajul Hawlader, echoed similar frustrations, “Getting an aqama for Bangladeshi workers is now like chasing a golden deer. If I can’t even send money home to my family, there’s no point in staying abroad.”
Bangladesh on the cusp of a fintech boom, if challenges addressed
The declining inflows from Saudi Arabia are reflected in Bangladesh Bank’s data.
In May, remittances from the kingdom stood at Tk 6,524 crore, dropping to Tk 5,763 crore in June, Tk 5,200 crore in July, and further down to Tk 4,800 crore in August.
“Saudi Arabia is restructuring its labor market with new skill benchmarks. Without meeting these requirements, workers face difficulties in securing jobs or residency permits. Bangladesh must prioritize skill development. Continuing to send unskilled laborers will only cause long-term damage,” said Marina Sultana, Director of Refugee and Migratory Movements Research Unit (RMMRU).
The United Arab Emirates (UAE), another major remittance hub, is emerging as an even bigger challenge. Reports suggest the UAE could stop issuing work visas for Bangladeshis starting in 2026, while visa complications have persisted since last year. Bangladeshi workers already face restrictions on visa transfers and family visas.
In March this year, remittances from the UAE were Tk 6,201 crore, but they fell to Tk 4,540 crore in April, Tk 3,461 crore in July, and Tk 3,382 crore in August. Economists warn that a full visa suspension could trigger a sharp collapse in remittance inflows from the UAE.
“We cannot afford to delay. Dhaka must engage Abu Dhabi in urgent diplomatic dialogue. Losing the UAE market would severely weaken Bangladesh’s overall foothold in the Middle East,” Mahfuz said.
Qatar, too, has shown declining inflows. Remittances dropped from Tk 1,432 crore in June to Tk 1,288 crore in July and further to Tk 1,113 crore in August.
Experts call for strategy, skilled workforce to lift Biman from setbacks
Oman, which banned Bangladeshi workers in 2023, shows a similar downward curve. While remittances briefly surged past Tk 2,000 crore in January this year, they started falling in June and came down to around Tk 1,700 crore by August.
Experts warn that unless urgent steps are taken, Bangladesh could face deeper setbacks in remittance inflows from the Middle East.
“The government must act now to safeguard the market, even amid regional instability,” Mahfuz observed.
Marina Sultana added, “Improving worker skills is non-negotiable. Authorities also need to investigate why so many returnees fail to secure jobs and design programs to enhance the productivity of those who remain abroad.”