The State Bank of Pakistan (SBP) said on Wednesday that the country recorded a current account surplus in July and August, the first two months of the current fiscal year (FY) ending June 30, 2021, owing to a fall in imports and surge in remittances.
SBP’s statement highlighted that the current account surplus was valued at $508 million for July and $297 million for August.
As a consequence, the cumulative current account surplus amounted to $0.805 billion during the tenure. In comparison to the corresponding period in the previous year, the positive difference was approximately $2.005 billion as a deficit worth $1.2 billion was recorded in July-August of the FY20, SBP mentioned on Twitter.
“Efforts to attract workers’ remittances, flexible exchange rate and relatively benign import prices explain the improving current account balance,” it added.
Earlier this month, Prime Minister Imran Khan said that the remittances sent to the country by the expatriates continued on an increasing trend on a year-on-year basis during July and August, as $2.77 billion and $2.10 billion worth of remittances were recorded during the months. The increase in remittances translated into a 24.4 per cent rise as compared to same time frame in the previous year.
This was “in addition to the record $2,768 million in July 2020″, PM Imran said on Twitter, adding that, “for the first two months of this fiscal year our remittances are up 31pc over the same period last year.”
SBP attributed the fulfillment of its projections to the efforts made under the Pakistan Remittances Initiatives (PRI) and the resumption of business activities in the host countries of most expatriates such as the United States, Middle East, and Europe.
However, “reflecting the usual seasonal decline in the post Eid-al-Adha period”, on a month-on-month basis, the remittances decreased by 24.3 per cent from July to August.
Special Assistant to the Prime Minister on Overseas Pakistanis Sayed Zulfiqar Bukhari in August had announced the provision of a digital banking facility to the overseas Pakistanis by the government.
The initiative would be a great investment opportunity for the Pakistani community living abroad, the premier’s aide had said, noting that digital banking had been a longstanding demand of the Pakistani diaspora.