KARACHI: Pakistan’s current account posted a deficit of $681 million in FY2023-2024, a significant decrease of 79 percent from the $3.275 billion deficit in the same period of the previous fiscal year, according to a report released by the State Bank of Pakistan (SBP) on Friday.
The current account deficit (CAD) amounts to 0.2 percent of GDP, the lowest in the last 13 years, said the SBP report.
“This significant decline was driven by a 6% reduction in the trade deficit and an 11% increase in remittances,” it added.
In FY24, the country’s total export of goods and services amounted to $38.9 billion, while imports totaled $63.3 billion during the period, according to SBP data.
Worker remittances clocked in at $30.25 billion, an increase of 11% compared to the same period last year.
On monthly basis, Pakistan’s current account posted a provisional deficit of $329 million in June 2024 compared to a revised deficit of $248 million in May 2024, the SBP data revealed.
Low economic growth along with high inflation have helped curtail Pakistan’s current account deficit, with an increase in exports also contributing.
During June 2024, Pakistan’s exports of goods and services stood at $3.07 billion, while imports totaled $5.69 billion. Meanwhile, remittances in June were $3.16 billion.
The current account is a key figure for cash-strapped Pakistan, which relies heavily on imports to run its economy. A widening deficit puts pressure on the exchange rate and drains official foreign exchange reserves.
Last week, Pakistan managed to secure a 37-month, $7 billion Extended Fund Facility (EFF), merely months after concluding a $3-billion Stand-By Arrangement.
