Current account turns positive on back of falling imports

The State Bank of Pakistan (SBP) on Monday reported the first current account surplus for the ongoing fiscal year in November. Despite low inflows and higher outflows for debt servicing, the current account was in surplus by $9 million in November compared to a deficit of $157m noted in the same month last year. However, the current account deficit (CAD) narrowed by almost 63pc to $1.16 billion in July-November FY24 from $3.26bn in the same period last year. October witnessed a CAD of $184m. The major impact was visible in the fall of imports, as goods imports fell by over $4 billion to $21.3bn during the five months of the current fiscal year. However, exports of goods slightly increased by $596m to $12.5bn during the same period. This decline in imports had a positive impact on the current account surplus in November. Exports of services declined by $103m to $2.99bn in the same period, compared to an increase in imports of services by $704m to $4.1bn. The trade deficit has been a key element in keeping the current account up or down.