ISLAMABAD: Pakistan’s improving economic momentum is starting to show in its external accounts, with the current account showing a deficit of $810 million for the five months, according to the latest data from the State Bank of Pakistan.
The state bank’s data shows that rising economic activity has fuelled import growth, as a result of which Pakistan imported goods worth about $25 billion during the first five months of the fiscal year, an 11 percent increase over the previous year. Meanwhile, exports declined by 3 percent during the same period, widening the external gap further.
Despite these pressures, November offered some positive signs. The country’s trade deficit narrowed to $2.59 billion, helped by a decline in imports of $4.72 billion, while exports stood at $2.27 billion. Moreover, the overall current account closed with a $100 million surplus in November, largely thanks to strong inflows.
Economists note that workers’ remittances of $3.18 billion in November played a decisive role in balancing the external accounts. According to experts, the increase in remittances has become Pakistan’s most reliable source of foreign exchange and an important buffer against rising import bills and income account deficit.
Analysts warn that foreign direct investment remains low, with inflows of just $313 million in five months, compared to $1.39 billion in the same period last year. Experts emphasise that improving investor confidence and boosting exports are essential to achieving long-term external stability.
They add that while remittances are currently supporting the balance of payments, sustainable economic health will depend on export-led growth and policy continuity.
