Prime Minister Imran Khan on Wednesday mentioned Pakistan was “headed in the right direction finally” because the nation’s present account witnessed a report surplus of $792 million within the first quarter of the present fiscal 12 months, information launched by the State Financial institution of Pakistan (SBP) confirmed.
The excess got here on the again of an upward pattern in remittances and month-on-month enhance in exports throughout September, in response to the central financial institution.
Present account surplus within the month of September clocked in at $73m, down 65.4pc from $211m in August, primarily on account of the widening commerce deficit throughout the month below assessment.
“Great news for Pakistan. We are headed in [the] right direction finally. Current Account was in surplus of $73m during September, bringing [the] surplus for 1st qtr to $792 mn compared to [a] deficit of $1,492 mn during [the] same time last year. Exports grew 29pc and remittances grew 9pc over previous month,” mentioned Prime Minister Imran Khan on Twitter.
The SBP mentioned in September, the present account posted a surplus for a 3rd consecutive month in a row.
“The surplus reached $73m [in September] against a deficit of $278m a year earlier. As a result, the current account recorded a surplus of $792m in 1QFY21, the first quarterly surplus in more than five years. Continued buoyancy in remittances (up 9pc m/m) and a broad-based rebound in exports (up 29pc m/m) drove the current account surplus in September. Imports also picked up in line with the on-going revival in domestic economic activity,” it added.
The month-on-month lower within the present account surplus got here because of an 8pc enhance within the commerce deficit in September, the central financial institution mentioned. Pakistan’s commerce deficit in September rose to $1.82 billion in comparison with $1.727bn in August on account of 62computer and 21computer soar in meals and equipment imports, respectively.
In September, steadiness of commerce in items deteriorated by $140m, up 8pc month on month on the again of enhance in imports of products by $581m or 18computer month-on-month, whereas exports of products improved by $441m — up 29computer from August, mentioned Chief Economist at Topline Securities Syed Atif Zafar whereas talking to Daybreak.
He mentioned that the steadiness on main revenue additionally deteriorated by $197m or 61computer over the earlier month, nonetheless, a rise in remittances by $189mn or 9pc helped cushion its affect.
“Looking forward, we expect the current account deficit to clock in at $2.5-3bn in FY21 (1.0-1.2pc of the GDP) as Covid-19 related lockdowns and restrictions ease globally and international oil prices also trend up,” he added additional.