Pakistan’s Current Account Reveals $959 Million Surplus For First 9 Months

In January, the deficit stood at $229 million, while the deficit in December 2020 was $625 million.

Revamping Pakistan's economy in 2020Pakistan posted a current account deficit of $47 million in March for the fourth month in a row.

However, the first nine months of FY21 remained in surplus territory, mounting hopes the fiscal year would not conclude with an overall deficit.

The data released by the SBP (State Bank of Pakistan) on Friday showed a current account deficit for March of $47 million, which was slightly higher than that of February, of $31 million.

In January, the deficit stood at $229 million, while the deficit in December 2020 was $625 million.

Nevertheless, during July-March FY21, the current account posted a surplus of $959 million.

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This means that the deficit has generally been declining, and the current account at the end of the third quarter of the current fiscal remained positive.

The country has had to accept several conditions to borrow much-needed funds from the International Monetary Fund (IMF).

In the process, the economy’s managers have had to face critique despite an improved external account situation.

This was mostly due to fears that the conditions would slow down the economy and negatively affect prospects for economic growth.

Experts believe that while the country needs to expand, the IMF is seeking consolidation in the economy that decreases chances for economic growth.

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The IMF has forecast a growth rate of 1.5% for FY21, while the World Bank has forecast a rate of only 1.3%.

Meanwhile, the SBP has stuck to its earlier stance that the growth rate will be 3%.

The current government has successfully brought down the current account deficit from a whopping $20 billion in FY18.

The country has now entered the surplus territory, which has strengthened the exchange rate and developed its image globally, allowing it to raise $2.5 billion via euro bonds.

As opposed to surplus in this fiscal, the current account deficit in the first nine months of the previous fiscal (FY20) was $4.147 billion.

This means that the government has succeeded in improving its ability to pay back loans.

What are your views on this? Share with us in the comments below.

  • hahahahaha, when money will not be used for anything, obviously it will stay there for paying debt. Best thing would have to generate economic activity so that there is a cash flow and people can also earn something in the process.

  • The current PM of the country used to complain the PM hosue daily expense is 10 lakh…and President house expense is 12 lakh…..and he thought by eliminating the expenses our budget will be balanced….our deficits will be covered.

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