Karachi March 18 2025: In February 2025, Pakistan’s current account balance remained negative for the second consecutive month but reduced significantly to USD 12 million compared to USD 399 million in January 2025 reducing July to February surplus to USD 691 million, according to data released by State Bank of Pakistan.
The balance on primary income improved in February, with the deficit decreasing by 23.9 percent. It improved from a deficit of USD 751 million in January 2025 to USD 571 million in February due to easing interest and dividend repatriation. Meanwhile, the balance on secondary income, which includes remittances, showed a positive performance. Remittances increased by 3.8 percent, increasing to USD 3,119 million from USD 3,003 million, the overall secondary income balance remained at USD 3,340 million.
The balance of trade in goods remained in deficit, but the deficit narrowed by 0.8 percent, decreasing to USD 2,430 million from USD 2,451 million in January. This deterioration was driven by a decline in exports of goods despite drop in imports. Exports of goods reached USD 2,593 million, marking a 13.3 percent decrease from the USD 2,992 million in January. On the other hand, imports of goods experienced a 7.7 percent decrease, dropping from USD 5,443 million in January to USD 5,023 million in February.
In the services sector, the balance also remained in deficit with narrowing gap. The balance on trade in services showed a USD 304 million deficit in January, a 8.3 percent decrease compared to the USD 332 million deficit in January. While exports of services increased by 2.4 percent to USD 709 million, the imports of services decreased by 1.1 percent, falling to USD 1,013 million.
As a result of these movements, Pakistan’s current account deficit for February 2025 dropped to USD 12 million deficit compared to deficit of USD 399 million reported in January
When looking at the cumulative numbers for the period from July to February, Pakistan’s current account balance stood at a surplus of USD 691 million, showing improvement compared to the USD 1,730 million deficit in the same period of FY24. This change was largely driven by a stronger secondary income balance, which increased by 31.8 percent, due to notable rise in remittances by 32.6 percent over the same period last year. However, the balance of trade in goods worsened by 17.4 percent YoY, with the trade deficit in goods expanding to USD 16,505 million from USD 14,053 million in the same period of FY24.
