Human Security in Pakistan The root cause of this problem is the large current account deficit annually since 2017-18, as shown in Chart 6.3. There have been years when imports have been significantly more than double the exports. Chart 6.3: Current Account Deficit/ Surplus as% of GDP There are altogether six indicators in this Index, as shown in Table 6.2. Four of these indicators show a strong declining trend. For example, foreign exchange reserves as a percentage of external debt have fallen from a peak of over 34 percent in 2005-06 to only 4% by December 2022. Further, reserves as a percentage of foreign exchange requirements are down to only 37%. Table 6.2: External Financial Vulnerability 2001-02 2005-06 2010-11 2015-16 2017-18 1. Real Effective Exchange Rate Index 0.395 0.418 0.403 0.581 0.452 2. External Debt(as% of GDP) Index 0.360 0.753 0.682 0.781 0.692 3. Foreign Exchange Reserves(in months of imports) Index 0.729 0.376 0.400 0.447 0.129 4. Reserves as% of External Debt Index 0.535 0.733 0.567 0.633 0.228 5. Current Account Deficit(as% of GDP) Index 0.800 0.215 0.486 0.375 0.139 6. Foreign Exchange Reserves as% of External Financing Requirements Index 0.019 0.294 0.741 0.311 0.113 OVERALL INDEX 0.307 0.419 0.530 0.496 0.228 2018-19 0.348 0.527 0.271 0.314 0.340 0.064 0.263 Latest Year 0.338 0.480 0.047 0.034 0.410 0.046 0.130 38