ISLAMABAD: Pakistan’s trade deficit with Middle Eastern countries narrowed by 3.99 percent in the first quarter of FY26, mainly due to a simultaneous decline in imports and exports, according to data released by the State Bank of Pakistan (SBP).
The trade gap fell to $3.56 billion during July–September FY26 from $3.70 billion in the same period last year. This comes after the deficit had widened by 7.37 percent in FY25, when it reached $13.97 billion compared to $13.01 billion the previous year.
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Imports from the Middle East decreased by 5.48 percent to $4.27 billion in the first quarter, reflecting lower oil purchases, particularly from the United Arab Emirates (UAE), as Pakistan diversified its energy sources by sourcing crude from the United States. Meanwhile, exports to the region declined by 12.19 percent to $715.6 million, down from $815 million last year.
Country-wise, Pakistan’s exports to Saudi Arabia fell 8.94 percent to $160.2 million, while imports dropped 16.99 percent to $884 million. Trade with the UAE showed mixed trends — exports fell 12.95 percent to $491.6 million, while imports increased 7.61 percent to $2.16 billion. Exports to Qatar, Bahrain, and Kuwait also showed varying performance, with Bahrain’s imports jumping significantly to $76 million from $19 million.
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Officials said the improvement in the quarterly trade gap reflects Pakistan’s gradual energy diversification strategy and the impact of its recent free trade agreement (FTA) with the Gulf Cooperation Council (GCC). However, they cautioned that the overall balance remains heavily dependent on petroleum imports, and sustainable progress will require expanding export products and markets beyond traditional goods.