KARACHI: Pakistan current account deficit recorded a contraction of 19 per cent during first two months (July – August) of the current fiscal year 2022/2023, according to data released by State Bank of Pakistan (SBP) on Wednesday.
The current account deficit during the period under review was at $1.92 billion as compared with $2.37 billion in the corresponding months of the last fiscal year.
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The contraction in current account deficit may be attributed to narrowing trade deficit during the period under review.
The trade deficit of the country recorded a decline of 16.36 per cent to $6.33 billion during July – August 2022/2023 as compared with the deficit of $7.56 billion in the corresponding period of the last fiscal year, according to Pakistan Bureau of Statistics (PBS).
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Importantly, the import bill of the country fell by 9 per cent to $11.06 billion during the first two months of the current fiscal year as compared with $12.15 billion in the same months of the last fiscal year.
On the other hand, the export exhibited an increase of 3.27 per cent to $4.74 billion during July – August 2022/2023 as compared with $4.59 billion in the same period of the last fiscal year.
The contraction in trade deficit may be attributed to the ban imposed by the government on import of luxury and non-essential items. The government imposed the ban on May 19, 2022. But, it was later lifted on August 20, 2022.
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However, some restrictions on import of various goods are still there as those clearances are subject to prior approval of the SBP.
Meanwhile, the overall remittances sent by Pakistani workers declined by 3 per cent during first two months (July – August) 2022/2023. The overseas Pakistani workers sent $5.25 billion during first two months of the current fiscal year as compared with $5.42 billion in the same months of the last fiscal year.
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The current account deficit for the month of August 2022 was $703 million as compared with the deficit of $1.52 billion in the same month of the last year. Whereas the deficit in August 2022 is also narrowed when compared with the deficit of $1.21 billion in the month of July 2022.
