Daily Times

KARACHI: Pakistan’s financial managers should remain cautious not to exceed the country’s financial capacity and resources, members of the export oriented industrial sector and business community said.

They believe that there should be a balance between country’s imports and exports otherwise, trade deficit will likely to reach $25 billion mark by end of fiscal year 2017.

Such a condition will force the government to consult international donors for foreign borrowings, which are not conducive or beneficial for the overall economy.

Executive members of Pakistan Tanners Association (PTA), Pakistan Yarn Merchant Association (PYMA), Pakistan Apparel Forum (PAF) and representatives of All Pakistan Business Forum (APBF) stated that during July-December 2016 of thhe fiscal year, Pakistan has already imported $5.7 billion worth of machinery, which is around 41 percent higher than the same period of previous year.

“This is due to excessive number of machinery being imported for the development of different ventures under the ‘China-Pakistan Economic Corridor (CPEC)”. However, Agha Saiddain of PTA, Ghulam Rabbani of PYMA and Ibrahim Qureshi of APBF were of the view that this reflects industrial progress nonetheless there should be some adjustment on financial terms specifically on the import cost of machinery in light of CPEC.

They believe that the recent increase in international petroleum product prices has also raised Pakistan’s oil-import bill to $5 billion; during first half 2017 it increased by 11.2 percent.

There has been an alarming rise in the trade-deficit of the country during July 2016 to January 2017. In the on-going fiscal year, Pakistan’s external sector is facing increased pressure as its trade deficit has widened by 28.7 percent to reach $17.4 billion due to a continuous decline in exports and a double-digit growth in imports.

The deficit has already risen by $3.9 billion; 28.7% more than the previous year’s comparative period as exports plunged 3.2% to total $11.7 billion during July-January 2017. In comparison, Pakistan’s imports increased by 13.7% to reach $29.1 billion in the same period. The import bill was $3.5 billion more than the previous year during the same period.

Pakistan Bureau of Statistics has also revealed that the country has breached its limits by booking a trade-deficit of $17.42-billion in July-January 2017, which is already equivalent to 85% of the country’s annual target.

Exports during this period were less than half of the yearly target, while imports have already reached two-thirds of annual projections. The State Bank of Pakistan has already issued a warning about this excessive gap between external payments and receipts and Current-Account Deficit which is expected to go beyond $4.5-billion.

The export oriented industrial sectors and business community always try to promote and protect the interests of the business community and a wide range of industries in the country.

They appealed to economic mangers of the government to seriously consider their suggestions regarding policy formulation, regulatory realignments and implementation in commercial and industrial sectors of the economy.