The State Bank of Pakistan (SBP) has reported a decline in current account deficit to $1.2 billion in the first month of new fiscal year from $2.2 billion in June, last month of subsequent fiscal year, reported 24NewsHD TV channel.

The State Bank attributed the shrink in deficit to wide-ranging measures taken in recent months to moderate growth and contain imports, including tight monetary policy, fiscal consolidation, and some temporary administrative measures.

The import bill fell by 38 percent to $4.86 billion in July 2022 as compared to $7.88 billion in June 2022, in line with the federal government’s expectations. On year-on-year basis, in July 2022, the imports were lower by $714 million, or 13 percent, compared to the same month last year, according to the Pakistan Bureau of Statistics (PBS).

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In order to curb the deficit and fiscal instability, the federal government and the State Bank of Pakistan (SBP) took administrative measures to reduce imports.

The government banned imports of more than three dozen of non‑essential luxury goods. The Ministry of Commerce (MOC), imposed the ban through SRO No. 598(I)/2022, effective from 19 May 2022.

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Moreover, on 20 May, 2022, SBP published a circular requiring authorized dealers to receive approval from the FX operations department before issuing or amending a line of credit (LOC), registering, or amending a contract, making an advance payment, or authorizing transactions on an open account or collection basis.