Pakistan has reported a current account surplus of $75 million, according to the latest data from the State Bank of Pakistan (SBP). This marks a notable improvement from the $246 million current account deficit recorded last month and the $152 million deficit from August 2023. On a cumulative basis, the current account deficit for the first two months of FY25 stood at $171 million, a significant reduction of 80.9% compared to the $893 million deficit in the same period of FY24.
EXPORTS AND IMPORTS TRENDS
In August, Pakistan’s total exports increased by 0.9% year-on-year (YoY) to $3.11 billion, up from $3.08 billion in August 2023. This represents a 3.4% rise compared to the $3.01 billion in exports from the previous month. Conversely, total imports rose by 9.7% YoY to $5.62 billion, compared to $5.12 billion in August 2023. On a monthly basis, imports decreased by 0.5%. The trade deficit in goods and services widened by 23.1% YoY to $2.51 billion, though it narrowed by 4.9% from the previous month.
CUMULATIVE TRADE DEFICIT AND EXPORTS
For the first two months of FY25, the trade deficit amounted to $5.14 billion, reflecting a 19.0% increase compared to the $4.32 billion deficit in the same period of FY24. During this period, exports grew by 5.7% YoY to $6.12 billion, compared to $5.79 billion in the previous year. Imports also rose by 11.4% to $11.26 billion, up from $10.11 billion.
REMITTANCES AND FOREIGN DIRECT INVESTMENT
Workers’ remittances saw a substantial increase of 40.5% YoY, reaching $2.94 billion in August compared to $2.1 billion in August 2023. However, on a monthly basis, remittances declined by 1.7% from $3 billion in the previous month. Cumulatively, remittances for the first two months of FY25 totaled $5.94 billion, up 44.0% from $4.12 billion in the same period last year.
Foreign Direct Investment (FDI) in August increased by 50.7% YoY to $214 million, compared to $142 million in August 2023. On a month-on-month basis, FDI rose from $136 million. For the first two months of FY25, FDI amounted to $350 million, marking a 55.6% increase compared to $225 million in the same period of the previous fiscal year.
SERVICE SECTOR TRADE DEFICIT AND EXPORTS
The service sector trade deficit widened by 46.6% YoY to $280 million in August, compared to $191 million in the previous month. On a yearly basis, the deficit stood at $220 million. Service exports in August fell by 6.49% YoY to $620 million, down from $663 million in August 2023. On a cumulative basis, service exports increased marginally by 0.16% YoY to $1.253 billion.
INFORMATION TECHNOLOGY EXPORTS AND IMPORTS
Telecommunications, Computer, and Information Services exports surged by 26.81% YoY to $298 million in August, making it the largest contributor to Pakistan’s service exports. IT exports accounted for 48.06% of the total service exports for the month. On a month-on-month basis, IT exports increased by 4.2% from $286 million in July 2024. For the first two months of FY25, IT exports grew by 30.07% YoY to $584 million.
