KARACHI, Nov 19: The country’s current account for the first four months was still positive, giving support to the economy facing serious shortage of foreign exchange reserves while making debt repayments worth billions of dollars.

The State Bank reported on Monday that the current account for July-October was in surplus of $258 million. In July-September, the figure was $435 million.

The external account position is expected to be better than last year since the current account was in deficit of $1.655 billion in the first four months. However, other factors that affect external imbalance were more dominating this year.

The foreign direct investment fell by 24 per cent; forex reserves have lost over $3.2 billion during the year; more than $4 billion debt repayments are expected during this fiscal year and there is no hope of a deal with the IMF on another loan.

Exports and imports, both are showing sluggish growth, leaving no hope for seeing the current account in surplus in the coming months.

The latest data showed that trade imbalance was almost the same like previous year.

The trade deficit for the first four months of the current fiscal year was $5 billion as against last year’s $5.3 billion in the same period.

Traders expressed concern as they see no chance of improvement in the situation, particularly related to trade and export.

A 12-hour production takes more than 24 hours and mainly because of shortage of electricity and non-availability of gas, said Aamir Aziz, a manufacture and exporter of textile-based products.

A number of processing mills, like dyeing and printing, have closed their operations as sufficient electricity is not available and gas supply is uncertain which is essential for boilers, he said, adding increase in exports from this largest sector are not possible.

Export earnings which still depend largely on textile sector could hardly increase during the first four months.

The total exports during the four months were worth $8.210 million as against $8.105 million last year.

Reports show that the country has strong cotton crop this year that could push up exports and more than last year, but the energy crisis has drastically slashed country’s ability to export value-added textile products.

The imbalance on the external front is getting support largely from higher remittances which shot up by 15pc during the four months, but falling forex reserves have battered the exchange rate, putting pressure on local currency to shed  weight on a daily basis.

Currency experts predicted further devaluation of local currency against the greenback. Pressure on rupee is mounting and factors accumulating pressure are increasing that may push up dollar to a rate of Rs100,” said Anwar Jamal, a currency dealer and expert on currency movement.

Currency experts said that the country was facing a default like situation in 2008 at the beginning of the new government and the situation is same at the time of departure of the government.