KARACHI/ISLAMABAD - The current account deficit of the country ballooned by 14 percent in July 2018.

The current account deficit expanded to $2.2 billion in July 2018 as compared with the deficit of $1.93 billion in the corresponding period of the last fiscal year.

During 2017-18, the current account deficit amounted to $18 billion.

As a percentage of GDP, current account deficit stands at a negative 8.6% of the GDP, while during the same month last year, current account deficit accounted for a negative 7.1% of the GDP.

According to provisional data released by the State Bank, exports of goods (FOB) during July rose by 10.3% over the year as the country exported goods worth $2 billion in July, while the growth in imports surpassed that of exports, having grown at a pace of 19.8% during that period.

Compared to $2 billion in exports, the value of imports stood at $5.566 billion, resulting in a trade deficit of $3.557 billion with respect to the trade of goods exported and imported.

CIRCULAR DEBT POSING SERIOUS THREAT TO ECONOMY

Islamabad Chamber of Small Traders on Tuesday said circular debt of over one trillion rupees is a result of gross mismanagement by the former government which is now posing a serious threat to the economy.

 The power sector circular debt has crossed the limit of one trillion rupees for the very first time in the history of the country which has become a threat to the GDP and it is hitting masses with power outages, it said.

The circular debt has become a big threat to the image, credit rating and economic revival which merits immediate attention of the new government, said Patron Islamabad Chamber of Small Traders Shahid Rasheed Butt. The debt is hitting industrial expansion, private investment in energy projects and pushing away much-needed investment which is not affordable at this critical juncture, he said.

Shahid Rasheed Butt said that circular debt results in loss of productivity in almost all the sectors, increase the cost of production, reduce exports and tax collection and fan agitation.

He noted that the former government had settled this debt in 2013 and claimed that this will never resurface again. The negative politics of those who falsely claimed to bury the debt forever has been buried by the masses in the recent election.

He said that the all details of the debt is not in the knowledge of the public which if lime lighted will shock the people.  

The business leader said that policy to handle the issue must be changed, strict accountability should be initiated while the areas where energy theft is rampant should face more loadshedding.

The localities paying their bills regularly should get relief from the loadshedding, he demanded.