Exports of services sector surged to $5.336 billion mark in July-March of FY13 against $3.897 billion in the same period last fiscal year, depicting an increase of $1.439 billion.
The services exports during the first nine months are $301 million higher than the overall services exports of FY12, in which it were stood at $5.035 billion. If the current level of growth is maintained, analysts expect the country to hit an all-time high level of services exports by the end of this fiscal. The State Bank data showed that rising exports helped shrink the services trade deficit by 84 percent or $1.758 billion during July-March of FY13 against the same period of last fiscal year. Services trade deficit shrunk to $339 million in the first nine months of the current fiscal year against $2.097 billion in the same period in last fiscal year.
Analysts said that despite some deficit, statistics for services trade were "very encouraging" with rising exports and declining imports. However, they said, the current decline in the deficit was because of the payment of Coalition Support Fund by the US and this "may increase during the next fiscal year".
During the current fiscal year, the country has received $1.8 billion on account of CSF in two instalments. First payment of $1.118 billion was arrived in August, while on December 28 last year, Pakistan received another tranche of CSF amounting to $688 million. With these inflows, services trade was presenting an improved picture, they maintained. "A surplus in trade balance will also help curtail the current account deficit, which is already a threat to the country's depleting forex reserves," they asserted.
A detailed analysis showed that during the period under review, services imports registered a slight decline of 4.3 percent. Service sector imports fell by $259 million to $5.735 billion in July-March of FY13 against $5.994 billion in the same period last fiscal year. On quarter-on-quarter basis, services sector trade has posted a deficit of $623 million with $1.765 billion exports and $1.142 billion imports during January-March 2013.
The country's service exports inflows comprise $2.9 billion on account of government services, $940 million on account of transportation services, $233 million from travel, $380 million from communication, $21 million from construction services, $217 million through information technology, $33 million from insurance sector and some $18 million on account of financial services during first nine months of FY13. While, transportation payments stood at $2.312 million, travel $980 million, communication $144 million, construction $6 million, insurance $195 million, financial sector $88 million and computer and information services payments stood at $149 million during the period under review. In addition, some $106 million was paid on account of royalties and $601 million on account of government services.