Pakistan’s current account balance shifted to a deficit of $420 million in January 2025, ending a three-month surplus streak as rising imports widened the trade gap, reversing the $474 million surplus recorded in December 2024 and marking a 4% increase from the $404 million deficit in January 2024, according to the State Bank of Pakistan (SBP).
This reversal in the current account balance came after a strong second quarter (October–December), during which the account posted a $1.504 billion surplus following a $402 million deficit in the first quarter (July–September).Â
However, a surge in the import bill led to a deficit in January. Pakistan’s goods imports rose 11% to $5.455 billion in January 2025 from $4.89 billion in the previous month. In contrast, exports declined 4% to $2.94 billion, widening the goods trade deficit to $2.5 billion from $1.835 billion in December 2024.
Despite the trade gap, remittance inflows showed strong growth, reaching $3 billion in January 2025, reflecting a 25.2% year-on-year increase from $2.4 billion in January 2024.Â
The overall current account balance remained positive in the first seven months (July–January) of FY25, posting a surplus of $682 million, compared to a deficit of $1.801 billion in the same period last year.
The SBP has cautioned that imports may continue rising in the coming months due to increasing economic and industrial activity. However, with strong remittance inflows, the central bank expects the current account balance to fluctuate between a surplus and a deficit of 0.5% of GDP in FY25.Â
Additionally, foreign exchange reserves are projected to exceed $13 billion by June 2025, supported by planned financial inflows.
