Pakistan’s current account (C/A) recorded a modest surplus of $12 million in April 2025, a sharp decline from the revised $1.2 billion surplus in March, according to data released by the State Bank of Pakistan (SBP).
On a year-on-year (YoY) basis, the surplus plummeted by 96%, down from $315 million in April 2024, highlighting the challenges posed by rising imports and fluctuating remittance inflows.
Why the Surplus Shrunk
Analysts attribute the narrowing surplus to a significant rise in the import bill, which outpaced the relatively slower growth in exports.
“Remittances, a key source of foreign exchange, declined due to post-Ramadan normalization, while a wider trade deficit strained the external balance,” said Waqas Ghani, Head of Research at JS Global, in a comment to Business Recorder.
Cumulative Performance: Stronger than Last Year
Despite the dip in April, the cumulative data offers a more optimistic picture:
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10MFY25 C/A Surplus: $1.88 billion
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10MFY24 C/A Deficit: $1.34 billion
This turnaround highlights improved external management and stabilization efforts by policymakers.
“We maintain our FY25 current account surplus target at $2.5–3 billion, or 0.6–0.7% of GDP,” noted Topline Securities.
April 2025 – Key Figures Breakdown
| Indicator | April 2025 | YoY Change |
|---|---|---|
| Exports (Goods + Services) | $3.33 billion | +1.2% |
| Imports (Goods + Services) | $6.14 billion | +15% |
| Trade Deficit | -$2.81 billion | Widened |
| Remittances | $3.18 billion | +13% YoY |
The strong remittance growth was offset by a widened trade deficit, neutralizing gains and resulting in a subdued monthly surplus.
Macroeconomic Factors at Play
Several factors have supported the improvement in the fiscal YTD current account position:
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Import restrictions and tight monetary policy
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High interest rates (now easing gradually)
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Weak domestic demand amid high inflation
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Export growth due to favorable global trends
These helped Pakistan manage its external balance despite persistent structural weaknesses.
Outlook: Surplus Likely, But Fragile
While Pakistan is on track to achieve a full-year current account surplus, the sustainability of this trend remains uncertain. Any shock in remittances, import liberalization, or a commodity price hike could easily reverse the gains.
