Current account balance posts $306 million surplus in September
The country's current account balance posted a $306 million surplus in September 2015 as against $240 million deficit in August 2015. Economists said a surplus current account was good indication for the economy and would reduce the pressure on the country's external account and foreign exchange reserves. "Although the country's liquid foreign exchange reserves have reached near about $20 billion historical mark, the lower current account deficit definitely would help to reduce pressure on foreign exchange reserves," they added.
Copyright Business Recorder, 2015
According to the State Bank of Pakistan (SBP), the country's current account balance has posted a surplus of $306 million in September 2015 compared to a $240 million deficit in August 2015 mainly supported by lower import bill and higher foreign inflows. Economists said that during the first quarter of this fiscal year Pakistan received over $700 million on account of the logistic support, of which some $376 million dollar has been arrived in September 2015. Inflows including Coalition Support Fund and home remittance had largely contributed to post a lower deficit in first quarter and surplus account in September 2015, they added.
Meanwhile, SBP reported that cumulatively current account deficit in the first quarter of this fiscal stood negative; however the deficit is much lower than same period of last fiscal year. With a decline of 93 percent or $1.522 billion, the country's current account deficit declined to $109 million in July-September of FY16 compared with $1.631 billion in corresponding period of last fiscal year (FY15).
Cumulative deficit of trade, services and income stood at $5.687 billion in first quarter of this current fiscal year as against $7.554 billion in the same period of last fiscal year, depicting a decline of 25 percent or $1.867 billion. The country's overall goods deficit stood at $4.522 billion with $5.421 billion exports and some $9.943 billion imports during July-September of FY16. Previously goods deficit was stood at $6.054 billion along with $5.959 billion exports and $12 billion imports during the same period of last fiscal year.
Analysts said that lower commodity prices particularly oil prices had reduced the import bill resulted in lower deficit. However, they said, concrete efforts were required to keep the import bills lower as oil prices in the world market were still unstable and continually fluctuating and any increase in commodity prices might put a negative impact on import bill.
Services sector performed well as its deficit down by 76 percent to $155 million with $1.582 billion exports and $1.737 billion imports during the period under review. Similarly, income sector outflows stood at $1.14 billion and inflows at $131 million, depicting a deficit of $1 billion during the first three months of current fiscal year. It may be mentioned here that Pakistan's current account deficit down 27 percent to $2.6 billion in the last fiscal year (FY15) led by double-digit growth in home remittances and lower oil prices in the international market.