KARACHI: Despite surge in foreign exchange reserves to $17.5 billon, the current account deficit further increased in May to $2 billion during the first 11 months of current financial year.
According to the State Bank of Pakistan (SBP), the current account gap widened by $521m in May due to the rising trade deficit. In April 2015 the C/A was in $223m surplus.
The government has failed to improve export sector’s performance, but the economic managers said due to low international goods prices reduced the export proceeds. The SBP report said that the current account deficit during July-May 2014-15 was $1.985 billion against $3.027 billion in the same period of last year.
Despite rising foreign exchange reserves and 16pc growth in remittances the current account deficit could not help to bring the current account deficit at zero level. The overseas Pakistanis remitted $16.6 billion during the first 11 months of this year.
The report indicates that the exports fell by almost $2 billion during the first 11 months of this fiscal year, while the imports dipped by just $500m. The trade imbalance during this period rose to $15.5 billion from $15.1 billion in the same period last year.
