Islamabad: Pakistan’s current account deficit has reduced by 73% to hit a record-breaking low by the end of the three quarters of the FY2019-20, a news source reported. According to details, the account deficit showed a significant reduction of USD 7.51 billion on a year-on-year basis as the three quarters of the current financial year ended.
The State Bank of Pakistan (SBP) reported that the current account deficit stood at USD 2.78 billion during the period of July to March for FY2019-20. The central bank added that the figure stood at USD 10.284 billion for the same period during the previous financial year.
According to reports, the current account deficit was recorded at USD 6 million at the end of March – despite the decline in exports of Pakistan amid the COVID-19 pandemic. Even though imports also decreased during March, the remittance inflows were positive – reflecting strongly on the status of the current account deficit.
On the other hand, the trade deficit of goods and services also dropped by 30% during the nine months of the FY2019-20. This figure decrease to USD 14.68 billion as compared to the USD 21.2 billion during the same period of last financial year. Meanwhile, the remittance inflows in the last nine months of the current financial year stood at USD 16.9 billion – showing an addition of USD 959 million.
However, from April onwards, the current account deficit may experience the impact of a slowdown in export receipts and remittance inflows due to the pandemic situation. The incumbent government has taken measures to mitigate these shocks of the global economic crisis with the help of exporters and incentives for remittances.