Karachi:
Pakistan registered a current account deficit of $ 103 million in May 2025, reducing a deficit of $ 235 million in the same month last year, but reversed the surplus of $ 47 million seen in April 2025.
Although Pakistan registered a rare current account surplus of $ 1.8 billion during the first eleven months of fiscal year 2015, which marked a significant change of the deficit of $ 1.6 billion registered in the same period last year, the warning that the vulnerabilities of the underlying external sector remain a cause of concern.
“The commercial deficit expanded in May 2025, increasing to $ 3.2 billion compared to $ 2.2 billion in the same period last year,” AHL wrote. The general trade balance registered a $ 27 billion deficit in 11MFy25, compared to $ 23 billion during the same period last year.
“We hope that the country will publish a current account surplus of $ 1.6 billion in fiscal year 2000 after 14 years,” said the brokerage house. “This growth is mainly due to an increase in remittances by 26% year -on -year to $ 38.1 billion, in our opinion.”
The surplus was largely driven by a strong year -on -year jump of 26% in workers’ remittances, which rose to $ 38.1 billion. This entry has helped cushion the impact of a broad commercial deficit, since imports of goods increased by 11% to $ 54.1 billion, exceeding the modest growth of 4% in exports of goods that were $ 29.7 billion.
Exports faced a new blow in May 2025, falling 19% year -on -year to $ 2.4 billion, while technology exports, once seen as a potential growth engine, decreased by 1% to $ 329 million. This low performance underlines Pakistan’s struggle to diversify and expand its export base.
Nasheed Malik of Topline Securities said that Pakistan registered monthly monthly exports worth $ 329 million in May 2025, reflecting a slight decrease of 1% year -on -year but an increase of 4% in a month. These exports were also higher than the average of 12 months of $ 314 million. In particular, this marked the first year -on -year decrease in IT exports after 19 consecutive growth. Export revenues averaged $ 16.5 million per day in May 2025, compared to $ 15.9 million in April 2025.
Accumulatively, exports reached approximately $ 3.5 billion during 11MFy25, showing a strong year -on -year increase of 19%. This impressive growth is attributed to several key factors: the expansion of the client base of the Pakistani Ti companies worldwide, especially in the CCG region; The relaxation of the State Bank of Pakistan (SBP) of the retention limit allowed in the specialized foreign currency accounts of exporters from 35% to 50%; the allocation of capital investment abroad through these accounts; and the stability of the Pakistani rupe, which has encouraged exporters to repatriate a greater part of their profits.
Ti Pakistani companies have also actively participated with international clients, as evidenced by their participation in the main global events such as Leap 2025 in Saudi Arabia and the Qatar 2025 website, Malik said.
A significant development in fiscal year 2015 is the introduction of SBP of a new category: Equity Investment abroad (EIA), specifically for export -oriented IT companies. According to this provision, IT exporters can now acquire capital participations in foreign entities using up to 50% of the income of their specialized currency accounts. This measure is expected to increase even more the confidence of IT exporters and encourage the repatriation of export profits to Pakistan.
Meanwhile, the services sector remains in deficit, registering a $ 2.7 billion gap for the period, since service exports could not compensate for the persistent import demand. The primary income deficit, which greatly reflects the repatriation of profits and interest payments on external debt, stood at a considerable $ 7.9 billion in 11MFy25.
To the concern is added the strong decrease in direct investment tickets (FDI), which fell to $ 1.98 billion, indicating the caution posture of foreign investors in the middle of the challenging economic and political panorama of Pakistan.
Analysts warn that the recent surplus is not structural but cyclical, largely depends on remittances and import compression. “If remittance growth or growth imports slow down, the surplus could quickly reverse,” said a market observer.
The perspective for the external account remains uncertain, with potential risks derived from the volatile world prices of oil and the increase in debt service needs, which could strive Pakistan’s fragile external position.
In May 2025, Pakistan’s primary income deficit was significantly reduced by 47% year -on -year to $ 777 million, compared to $ 1,478 million in May 2024, largely due to the absence of considerable repatriation of profits recorded in the same period last year. However, about a month by month, the deficit was extended by 31%.
Meanwhile, the balance on secondary income improved 12% year -on -year, increasing to $ 3.9 billion in May 2025 of $ 3.5 billion in May 2024, backed by strong tickets, such as workers’ remittances. However, in a comparison from month to month, secondary income decreased by 13% of $ 3.5 billion registered in April 2025.
