Pakistan posts Current Account Deficit of $200mn in April

May 24, 2021 (MLN): Pakistan’s current account balance posted a small deficit of USD 200 million in April 2021, depicting a decline of 61% when compared to April 2020.

The cumulative surplus in the current account balance stood at USD 800 million in the first ten months (Jul-April) of the current fiscal year, a significant turnaround from the USD 4.7 billion deficit during the same period last year.

The aforesaid announcement was made by the State Bank of Pakistan (SBP) on its official Twitter handle.

With the economy rebounding strongly in FY21, imports are picking up but are offset by unprecedented growth in remittances and recovery in exports. With the CAB contained and FX reserves at a 4 year high, the economic revival is on a sound and sustainable footing, the SBP said.

Going into details released by SBP, the exports of goods increased by 61% YoY to USD 2.30 billion in April 2021 while imports surged by 58% YoY to USD 4.97 billion, resulting in a trade deficit of USD 2.67 billion. During 10MFY21, the trade deficit was recorded at USD 21.32 billion compared to a deficit of USD 17.58 billion from 10MFY20, showing the deficit worsened by 21% YoY.

The trade deficit in services stood at USD 57 million, showing an improvement of 65% YoY as a result of an increase in export services by 48% YoY though the imports also increased by 13% YoY in April 2021.

While on a cumulative basis, the trade deficit in services also improved by 53% to clock in at USD 1.42 billion during Jul-April Fy21 when compared to a deficit of USD 3.02 billion recorded in the same period last fiscal year as imports of services plunged by 18% YoY while exports rose by 4% YoY in 10MFY21.

According to the figures provided by SBP, worker remittances in the first 10 months of FY21 surged substantially by 56% YoY to USD 24.25 billion from USD 18.79 billion in the corresponding period of FY20. On a yearly basis, remittances grew by 56% YoY to USD 2.78 billion in April 2021.

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