Karachi: The services sector’s trade deficit has reached to USD 1.166 billion in the 5MFY12 primarily on the back of high imports and stagnant exports.
According to Alfalah Securities Limited, the State Bank of Pakistan (SBP), services sector’s trade deficit has witnessed an increase of USD 182 million (18.5% YoY) to USD 1.16 billion in 5MFY12 against USD 0.984 billion in the corresponding period last year. The exports of the services sector stood at USD 2.023 billion in 5MFY12 against USD 2.038 billion in 5MFY11, showing a decline of USD 15 million whereas the services sector imports reached to USD 3.189 billion in 5MFY12 against USD 3.022 billion in the corresponding period last year, witnessing an increase of USD 167 million.
Meanwhile on monthly basis, the services sector’s trade deficit stood at USD 200 million in November 2011 which comprises of USD 376 million exports and USD 576 million imports. The rising services sector’s trade deficit has also caused a massive increase in the Current Account Deficit (CAD) of the country which has reached to USD 2.1 billion in the ongoing financial year. The government is required to come up with prudent policies for curtailing the services sector’s deficit which would also provide a shelter to the deteriorating Current Account Deficit of the country in the long term.