In a notable shift from previous deficits, Pakistan’s current account recorded a modest surplus of $12 million in April 2025. This development marks a significant improvement from the $420 million deficit observed in February 2025, as reported by the State Bank of Pakistan (SBP) .
Key Factors Contributing to the Surplus
The primary driver behind this surplus is the substantial increase in remittances from overseas Pakistanis. In March 2025, remittances surged to a record $4.1 billion, reflecting a 37% year-on-year increase. This influx has been attributed to seasonal factors, such as Ramadan and Eid-related transfers, as well as improved routing through formal channels due to recent government and central bank initiatives .
Exports of goods and services also experienced growth, reaching $3.51 billion in March, up 8.7% from the same month the previous year. However, imports rose by 8% to $5.92 billion, leading to a widening trade deficit . Despite this, the overall current account balance remained positive due to the strong remittance inflows.
Implications for Pakistan’s Economy
The April surplus, though modest, is a positive indicator for Pakistan’s external account. It suggests a potential stabilization in the country’s balance of payments, reducing reliance on external borrowing and alleviating pressure on the Pakistani rupee. SBP Governor Jameel Ahmed has projected that, with continued strong remittance inflows and controlled oil import bills, Pakistan’s current account could remain in surplus through June 2025 and possibly into FY26 .
However, challenges persist. The trade deficit in goods and services widened to $21.05 billion during the first nine months of FY25, up from $18.36 billion in the same period the previous year . This indicates that while remittances are providing temporary relief, structural issues in trade balances remain a concern.
Outlook
If the current trend continues, Pakistan may achieve its first quarterly current account surplus in nearly four years by the end of FY25. This would be a significant milestone, reflecting improved external sector performance and potentially bolstering investor confidence .
In conclusion, while the $12 million surplus in April 2025 is modest, it represents a positive shift in Pakistan’s external account dynamics. Sustained remittance inflows and controlled import growth will be crucial in maintaining this positive trajectory and addressing underlying trade imbalances.
