Karachi: Pakistan’s current account deficit (CAD) crossed the $17 billion mark during the fiscal year 2022, a staggering 531% increase in the balance of payments compared to the imbalance of $2.8 billion recorded during FY21.
According to a report published by the State Bank of Pakistan (SBP), the record imbalance in payment during FY22 is the highest since FY18, when it crossed $19.1 billion.
1/2 As foreshadowed by earlier PBS data, a surge in oil imports saw CAD rise to $2.3bn in Jun despite higher exports & remittances. So far in Jul oil imports are much lower & deficit is expected to resume its moderating trajectory. Visit #EasyData https://t.co/q3LNv3HgLs pic.twitter.com/lvwO9Bo3PJ
— SBP (@StateBank_Pak) July 27, 2022
Since then, the annual CAD relatively started dropping, even though there was occasionally high CAD quarterly.
The report by the central bank also shows that 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 FY22.
In June alone, the CAD swelled to $2.27 billion compared to May’s $1.4 billion during the fiscal year that ended on June 30.
The State Bank said that this surge in current account deficit during June, despite higher exports and remittances, was due to a surge in oil imports. It said that 3.3 million metric tons of oil were imported in June, 33% higher than in May.
2/2 3.3mn metric tons of oil was imported in Jun, 33% higher than in 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. See report: https://t.co/Od8ikVvpBF
— SBP (@StateBank_Pak) July 27, 2022
It also predicted that the deficit is expected to resume its moderating trajectory in July, as imports are much lower so far.
