The country’s current account posted a surplus of $654 million in March 2023, the first time since November 2020 that the country has posted a surplus.
According to data released by the State Bank of Pakistan (SBP), cumulatively the current account deficit (CAD) reduced to $3.4 billion in July-Mar FY23 against a deficit of $13.0 billion in July-Mar FY22.
The current account balance is the difference between the government’s foreign income and expenditure, to put it simply a current account deficit occurs when the government’s foreign income is less than expenditure while a current account surplus occurs when foreign income exceeds expenditure.
During FY22, Pakistan’s current account deficit stood at $17.481 billion. The country’s current account deficit for the first month of the current fiscal year (FY23) i.e. July 2022 was recorded at $1.26 billion.
Subsequently, the government imposed import restrictions, that continue even now, to curb the deficit and the impact was seen in the month of August when the deficit was reduced to less than $1 billion. In each of the past four months, the current account deficit was less than $500 million, however, the elusive surplus had evaded Pakistan till now.
