Daily Times

KARACHI: Declining exports coupled with foreign exchange inflows continue to bleed Pakistan’s economy at the external front as country’s current account deficit for the first time has swelled by 3.2 percent of GDP in the 11 months of current fiscal year 2016-17 (Jul-May 2017.

According to statistics issued by State Bank of Pakistan (SBP), the current account deficit widened to $11 billion in the period of July 2016 to May 2017 as compared to $5 billion deficit recorded in the similar period of the last fiscal year.

During the last 11 months of current fiscal the exports of goods decline to $19.78 billion against $20.1 billion worth of goods exported in the same period last year. The data shows that the imports increased to $43.4 billion during the same period as compared to $37.2 billion of goods imported during last fiscal year. Thus the balance of trade in goods was recorded at $23.66 billion against $17.1 billion of 11 months of last fiscal year.

However, the services sector’s exports marginally increased to $5.1 billion as compared to $5 billion of corresponding period of last fiscal year while imports stood at $8.2 billion against $8.1 billion of previous year. The accumulated balance of trade in goods and services stood at $26.8 billion against $20.2 billion of the same period last year.

The inflow of workers’ remittances also continues to dent the economy. During the period under review the remittance declined to $17.4 billion from $17.8 billion of the same period of 11MFY16.

Keeping in view the swelling current account deficit experts call for measures to enhance country’s exports by redrawing trade policy as the exports from Pakistan are continuously declining. Pakistani exporters still are relying on export of traditional items in traditional markets rather than exploring new products and market that is, according to experts, one of the major cause of export setback.

The current account, broadest measure of trade, covers flows of goods, services and investment. The current account is an important indicator of economy’s health.

Published in Daily Times, July 7^th , 2017.