Pakistan’s Current Account Deficit Reaches $17.4bn
New Delhi: The State Bank of Pakistan on Wednesday reported that the country recorded a current account deficit (CAD) of $17.406bn in FY22 compared to a gap of just $2.82bn in FY21. The massive CAD speaks a lot about the severe problem of the balance of payments.
In November 2021, the SBP issued its Annual Report and said the current account deficit is projected in the range of 2pc to 3pc of GDP during FY22. The current account deficit has exceeded the SBP’s projection for the deficit in FY22. The CAD increased to 4.6 percent of GDP in FY22, up from 0.8pc in FY21.
The PML-N-led coalition government posted a CAD of $4.323bn in the April-June period of 2021-22, which was the second highest quarterly deficit of the fiscal year that ended on June 30.
The deficit of over $17.4bn is more inflicting in the wake of no inflows as loans while the commercial markets are not ready to accept Pakistan’s bonds due to higher risks. The CAD in June FY22 was much higher than in May as it rose to $2.275bn in June compared to $1.430bn in May. The CAD in June FY21 was $1.637bn.
The imports of goods were $72.05bn, while the imports of services were $12.14bn. The balance of trade in goods and services showed a net deficit of $44.77bn in FY22 compared to $31.15bn a year ago.
The central bank said 3.3 million tonnes of oil were imported in June, a 33pc increase over May.
“Together with higher global prices, this more than doubled the oil import bill from $1.4bn to $2.9bn. By contrast, non-oil imports ticked down,” said the SBP.
(Vinayak)
