ISLAMABAD: Minister for Finance and Revenue Muhammad Aurangzeb said the Current Account Deficit (CAD) has declined significantly by 79 per cent to $217 million in the first two months of the current fiscal year compared to the same period last year.
In a written reply to a question on Wednesday, the minister told the National Assembly that in August, a surplus of $29 million was recorded.
“This sharp reduction in the CAD is primarily ‘attributed to robust inflows from workers’ remittances and stable export earnings, which have helped to manage the rising import bill,” he said.
About the export growth, he said that exports are projected to reach around $33 billion in financial year 2025, supported by increased domestic production, exchange rate stability, economic recovery, budgetary incentives, and strong growth in major trading partner economies. He said that service exports, especially in the IT sector, are expected to rise to $8.5 billion. Specifically, IT exports are forecasted to increase from $3.2 billion in FY2024 to $4.2 billion in FY2025.
Pakistan records $349mn current account surplus in October 2024
About the remittances, the minister said that remittances are estimated to reach $33.5 billion, driven by favourable economic conditions in remittance source countries, exchange rate stability, reduced global inflation, and government measures encouraging formal remittance channels.
He said the government has allocated Rs80 billion (FY2025) to encourage remittances through official channels, providing transaction rebates and rewards to promote formal banking usage.
Answering another question, Minister for Commerce Jam Kamal Khan told the House that in 2023-24, Pakistan’s rice exports reached a notable $3.8 billion, rising from $2.1 billion in 2022-23. He said that projections indicate that rice exports could achieve the $5 billion mark in 2024-25. He said that from July to October, the grand total of rice exports saw an approximate 48.81 per cent increase in value and a 43.77 per cent rise in quantity when compared to the same period in 2023-24.
He said India holds a leading position in the global rice market, commanding a 40 per cent share and setting international prices, which heavily influence the pricing strategies of other exporters. He said the concessions India grants its rice exporters can significantly impact Pakistan’s export performance by intensifying competition.
He said the ban India imposed on rice exports in 2023-24 was one of the factors that contributed to Pakistan’s increased rice export value, which rose to $3.8 billion from $2.1 billion in 2022-23.
He said the Ministry of Commerce has been actively working to secure protection and recognition or Basmati rice as a Geographical Indication (GI) in several foreign markets, including by opposing India’s applications for Basmati GI registration in EU, USA, Sri Lanka, Australia and Indonesia.
He said Pakistan has also filed independent applications for GI registration of Basmati rice in EU, USA, Sri Lanka, Australia, Thailand, New Zealand, Turkiye, Kenya and United Kingdom.
He said India holds a 40 per cent share in the global rice export market, setting the international price and influencing the pricing strategies of other exporters. “The strong presence of Indian rice in international markets creates significant competition for Pakistan’s rice exports, potentially affecting market share, pricing dynamics and the ability to maintain export volumes,” he said.
Responding to a question during the question hour, Parliamentary Secretary Planning Development and Special Initiatives Wajiha Qamar told the House that Gwadar Port is currently fully operational, equipped to handle general cargo, containers and other operation.
She said the Port accommodates vessels of up to 50,000 DWT and possesses the requisite infrastructure to support bulk cargo and container handling efficiently. She said multiple shipments under the Afghanistan-Pakistan Transit Trade Agreement have been successfully processed.
Replying to a calling attention notice, Parliamentary Secretary Cabinet Division Sajid Mehdi said the government is working on various measures, including legislation, to check spread of fake news on social media platforms. He said Prime Minister Shehbaz Sharif has established a task force with the aim to curb “fake news” on social media.
“The Civil Servants (Amendment) Bill, 2024” and “The Privatization Commission (Amendment) Bill, 2024” were introduced in the House.
Copyright Business Recorder, 2024
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