Pakistan’s Current Account Reaches Historic Surplus in March 2025

Driven by unprecedented remittance inflows, Pakistan’s current account achieved a record monthly surplus of $1.2 billion in March 2025, according to recent data from the State Bank of Pakistan (SBP).

This surplus represents a 229 percent surge compared to March 2024, which saw a surplus of $363 million. The March 2025 figures also mark a substantial improvement from February 2025’s $97 million deficit, signaling a significant recovery in the nation’s external financial standing.

According to the SBP, the cumulative current account surplus for the first nine months (July-March) of FY25 totaled $1.859 billion, a notable turnaround from the $1.652 billion deficit recorded during the corresponding period in FY24.

Analysts pointed out that the March surplus was primarily boosted by record remittance inflows of $4.1 billion, the highest ever recorded in a single month. These inflows were crucial in offsetting trade-related outflows and bolstering the overall external account position.

Analysts stated, “This is a very positive development for Pakistan’s economy.” They further suggested that consistent enhancements in the current account could alleviate pressure on the rupee, stabilize the balance of payments, and support the accumulation of foreign exchange reserves.

Echoing the central bank’s view, analysts commented that the surplus offers essential economic relief amidst global economic uncertainties. They added, “With steady remittances and reasonably stable oil import costs, this surplus could lessen the need for external borrowing, while also strengthening the country’s foreign exchange reserves.”

SBP Governor Jameel Ahmed has projected an increase in the nation’s foreign exchange reserves due to increased remittance inflows. The Governor stated that the SBP’s reserves are expected to reach $14 billion by the close of June 2025, surpassing previous estimates of $13 billion.

A detailed examination indicates that Pakistan’s goods trade deficit expanded by 15 percent, reaching $18.73 billion in the first nine months of the current fiscal year (FY25), compared to $16.47 billion in the same period last year.

The rise in the deficit was primarily due to increased imports, which grew from $39 billion to $43.39 billion. Simultaneously, exports saw a moderate increase from $22.89 billion to $24.66 billion, indicating a slight improvement in export performance amid rising domestic demand.

In the services sector, Pakistan experienced a deficit of $2.32 billion, with exports amounting to $6.2 billion against imports of $8.5 billion during the reviewed period.

Over the past couple of years, Pakistan has faced a continuous financial crisis, necessitating significant foreign inflows to fulfill external debt obligations. As part of its stabilization strategy, the nation secured a $7 billion Extended Fund Facility (EFF) arrangement with the International Monetary Fund (IMF) to strengthen its foreign exchange reserves and rebuild market confidence.

The nation’s external sector is now displaying indications of recovery, supported by favorable policy actions and enhanced macroeconomic fundamentals, notably including record remittances and easing pressures on imports.