Pakistan’s current account deficit has recorded a huge 256% increase in the first four months of the current fiscal year 2025–26, primarily due to a sharp rise in the import bill.
According to figures released by the State Bank of Pakistan (SBP) on Monday, the country’s current account deficit reached $733 million during July–October of FY26, compared to $206 million in the same period last year, showing an increase of $527 million.
Revised monthly data indicates that after posting an $83 million surplus in September 2025, the current account swung to a $112 million deficit in October 2025.
This shift was mainly driven by a 4% month-on-month increase in the trade deficit, caused by imports rising faster than exports amid improving domestic demand.
The SBP anticipates that as economic activity further improves, imports will continue to increase. Meanwhile, the outlook for remittances has also strengthened. Despite the recent rise in the deficit, the SBP believes the current account deficit for this fiscal year will remain within the previously estimated range of 0% to 1% of GDP.
Pakistan’s import bill has been steadily rising, reaching $20.72 billion in the first four months of the ongoing fiscal year, a 10% increase from $18.9 billion in the same period last year.
On a positive note, remittances are growing faster than expected, with $3.4 billion recorded in October 2025, up from $3.1 billion in September 2025. With improving remittance inflows, the SBP expects these to remain above target by the end of the fiscal year. Moreover, with anticipated inflows of funds, the SBP’s foreign exchange reserves are projected to reach $15.5 billion by December 2025.
