ISLAMABAD  -  Pakistan has recorded a current account surplus of $619 million in March 2024. “A current ac­count surplus of $619 million has been recorded in Mar 2024. Cumulatively for Jul-Mar FY24, CAB improved significantly; re­cording a deficit of $0.5 billion only compared to $4.1 billion in Jul-Mar FY23,” State Bank of Pakistan (SBP) said on Monday. Cumulatively the current ac­count balance for July to March (2023-24) has improved signifi­cantly; as deficit of $0.5 billion was recorded during the period as compared to the deficit of $4.1 billion during the corre­sponding period of last year.

According to SBP figures, the merchandize trade deficit was recorded at $15.8 billion during July-March period of the year 2023-24 as against $21.08 bil­lion in the same period of the last year. Meanwhile, services’ trade deficit has recorded at $-1,655 million during July to March pe­riod of the FY2023-24 as com­pared to the deficit of $374 mil­lion during the corresponding period of last year. The overall trade deficit in goods and ser­vices was recorded at $17.412 billion during the current fiscal year compared to the deficit of $21.453 billion during last year.

Meanwhile, the balance on primary income stood at negative 5,561 million against $4,000 million last year, accord­ing to the SBP data.

The ministry of finance had already projected that current account will remain in sustain­able limit in March. According to BOP data for February 2024, current account turned to sur­plus of $128 million (Deficit of $ 303 million in Jan, 2024). The key factor for this improvement was a decline in the trade deficit in goods and services declined by 14.2 percent on MoM basis ($ 2.2b in Jan 2024 to $ 1.9b in Feb 2024). Both exports and imports of goods and services declined by 5.8 and 9.1 percent, respectively. Similarly, balance on primary income improved by 36 percent, due to lower pri­mary income debit.

However, remittances which may play more instrumental role in current account improve­ment, decreased by 6.2 percent on MoM basis. For the month of March, it is expected that exports of goods and services will im­prove and reach at level around $ 3.5b due to favorable foreign demand by Pakistan’s main ex­ports destinations. Similarly, im­ports of goods and services will touch around $ 5.5b in March 2024. Nonetheless, remittances are expected to improve due to positive seasonal and Ramzan-eid factor. Considering these factors, as well as other compo­nents, the current account will remain in sustainable limit.