Current account posts $3m surplus.

Byline: Shahid IqbalUpdated

KARACHI -- The country's current account deficit narrowed to $3.28 billion in the first eleven months of current fiscal year, while declining sharply in May.

The State Bank of Pakistan (SBP) on Wednesday said the account posted a surplus of $3 million in May against a deficit of $35m in April.

The government has been working hard to bring down record-high the $2bn deficit in FY8 to more manageable levels. During July-May, the deficit fell by 73.6 per cent compared to $2.453bn in the same period last fiscal year. The sharp reduction in import bill led to the narrowing of fiscal deficit in the current fiscal year as exports showed lackluster growth despite government's incentives to the export-oriented sectors.

The data released by the Pakistan Bureau of Statistics (PBS) showed export of goods fell to $2.9bn, down from $22.5bn in the last fiscal year. Meanwhile, imports fell to $38.9bn from $47.8bn last year.

Bankers said the import bill is expected to be much higher in June as importers are rushing to buy petroleum products due to the fuel shortage in the country. The country is facing a shortage of petroleum products due to delayed decisions regarding import of petroleum products amid uncertain demand.

They further said that due to this sudden increase in buying, the demand for dollars has shot up and rupee has fallen to record low against the dollar in the interbank market.

Despite successful reduction in current account deficit, the economy's external front continues...