Bangladesh is not expected to experience an immediate decline in remittances from Saudi Arabia despite increased Houthi attacks on the kingdom since early October. However, experts warn that a slowdown in new migration to Saudi Arabia could reduce remittance inflows over the longer term.
Since the escalation of hostilities, migratory flows to Saudi Arabia—the largest destination for Bangladeshi workers—have been disrupted. As of late October, around 144 direct and transit flights had been affected by ongoing flight restrictions at Saudi airports, impacting roughly 22,000 passengers. Despite this disruption, economists and labor specialists say newly arrived migrants generally take about a year before they begin sending significant amounts of money home, suggesting current remittance levels may hold steady in the short run.
The longer-term effects will largely depend on the duration of the crisis in Saudi Arabia, the kingdom’s economic performance, and labor demand, especially in construction, which has been a major employer of Bangladeshi workers. Zahid Hussain, a former lead economist at the World Bank’s Dhaka office, noted that if Houthi missile and drone attacks continue without severely damaging oil infrastructure, higher global oil prices might actually bolster Saudi revenues. This, in turn, could sustain or even increase demand for foreign labor. “But everything is uncertain so far,” Hussain added.
Remittances are a critical source of foreign currency for Bangladesh, accounting for approximately 7.5 percent of its gross domestic product. The importance of these inflows has intensified amid global energy market volatility, exacerbated by the ongoing US-Israel conflict with Iran. In the July-September quarter of the current fiscal year, remittances from Saudi Arabia totaled $1.65 billion, up from $1.23 billion during the same period the previous year. Saudi Arabia contributed 19.2 percent to Bangladesh’s total remittance inflows in the first quarter of fiscal year 2027, compared with 16.26 percent a year prior. Overall remittances during the quarter reached around $8.59 billion, with Gulf Cooperation Council (GCC) countries remaining the primary sources.
The current disruption highlights Bangladesh’s heavy reliance on a limited number of overseas labor markets, which exposes both migrant workers and the economy to regional instability. Since fiscal year 2014-15, Saudi Arabia has employed roughly half of the 9.6 million Bangladeshis who have sought work abroad. Workers in the kingdom typically send about $5 billion back home annually.
Recent data indicate a significant decline in overseas employment: the number of workers leaving Bangladesh dropped 36 percent year-on-year to 134,000 in July-August 2026, following a record low of around 969,000 in fiscal year 2026. Tasneem Siddiqui, executive director of the Refugee and Migratory Movements Research Unit and political science professor at Dhaka University, described the current crisis as revealing systemic weaknesses in Bangladesh’s migration sector. She called for a comprehensive overhaul and diversification of labor markets to reduce vulnerability and mitigate future shocks.
Long-term strategies include developing skills tailored to specific overseas markets and expanding job opportunities beyond the traditional Gulf destinations. Hassani urged increased budget allocation for the remittance sector, which currently receives just 0.08 percent of the budget despite generating billions in foreign exchange. Economist Zahid Hussain recommended targeting countries with aging populations and labor shortages, such as Japan and parts of Eastern Europe, where demand is growing for workers in caregiving, nursing, and manufacturing.
Sayema Haque Bidisha, an economics professor at Dhaka University, also advocated for greater diversification of destinations, improved diplomatic engagement, and enhanced support for migrant workers through overseas missions. She emphasized the importance of rebranding Bangladeshi workers as skilled labor contributors, beyond the prevailing perception of them as primarily manual laborers.
Security concerns and the nature of employment in Saudi Arabia—often daily or weekly wage jobs—have already curtailed work opportunities for many Bangladeshi migrants, according to Shariful Hasan, associate director of BRAC’s Migration Programme and Youth Platform.
Bangladesh is not alone in its dependence on remittance inflows from Saudi Arabia. Its neighbors India and Pakistan also rely substantially on the kingdom. Saudi Arabia was Pakistan’s top remittance source in the last fiscal year, with inflows of $9.78 billion, while approximately 7 percent of India’s remittance income, amounting to about $8 billion annually, comes from Saudi Arabia. Consequently, a protracted crisis affecting Saudi labor markets could have a more pronounced impact on Pakistan due to its greater reliance on remittances from the kingdom compared to India.