Pakistan’s current account deficit falls to lowest in 13 years

Pakistan’s current account deficit in fiscal year 2023-2024 was $681 million, the lowest in 13 years.

Last year, the country’s current account deficit was $3.3 billion. The 79% decrease is due to a reduction in its trade deficit and an increase in remittances.

A current account deficit indicates that a country’s foreign expenses exceeded its income abroad.

Data shared by the State Bank of Pakistan (SBP) showed that the country’s total import of goods in FY24 stood at $53.16 billion, marking a 1% year-on-year increase. On the other hand, exports went up by 12% YoY to $31.09 billion.

This indicates the trade deficit in goods decreased by 11% YoY to $22.07 billion.

Meanwhile, exports of services hit a record high of $7.80 billion in FY24, reflecting a 3% YoY growth. But imports of services also increased by 17% YoY to $10.12 billion.

Consequently, the trade deficit in services increased by 122% YoY to $2.31 billion.

Overall, remittances grew by 11% YoY in FY24, reaching $30.25 billion.

The current account deficit for June 2024 was $329 million compared to a surplus of $490 million in June 2023.

In June, imports of goods surged by 46% YoY to $4.63 billion, while exports increased 15% YoY to $2.43 billion, resulting in a trade deficit that soared by 106% YoY to $2.19 billion.

Exports of services grew by 8% YoY to $640 million, but imports of services also rose by 41% YoY to $1.05 billion, leading to the trade deficit surging by 168% YoY to $415 million.