Daily Times

Pakistan’s trade account is showing early signs of improvement under the spirit of the new economic policy as country’s trade deficit in first four months of current fiscal fell to $ -11.8 billion from the $ -12.1 billion reported in corresponding period of last fiscal, official data showed on Monday.

The overall trade deficit contracted by 1.97 percent in July-October 2018 period of Fiscal Year 2018-19 (FY19) as compared to the same period of FY18, reported the Pakistan Bureau of Statistics (PBS).

In FY18, Pakistan witnessed a record trade deficit of US$ 37.6 billion; 15.7 percent higher from last year. The broad-based and quantumled rebound in exports – after consecutive declines over the last three years – was overshadowed by surging imports, which almost touched the US$ 61.0 billion mark.

According to the State Bank of Pakistan (SBP), adverse movement in global oil prices, coupled with strong demand for industrial raw materials – metals and allied products – was mainly responsible for the higher imports. Resultantly, the country’s balance of payments came under severe strain during the past year.

However, the overall exports in first four months of FY19 increased by 3.52 percent to $7.38 billion as compared to $ 7.13 billion worth of goods exported in corresponding period of previous fiscal year. Imports in first four months of FY19 remained intact, going up by 0.06 percent to $ 19.17 billion as against $ 19.16 billion in the same period of FY18.

On monthly basis, exports from Pakistan to other countries went up significantly by 10.15 percent in October 2018 to $1.91 billion as compared to $ 1.82 billion in September 2018. Similarly, imports in the country also grew by 9.28 percent in October 2018 to $4.94 billion as compared to $4.53 billion in the month of September 2018. Trade deficit widened by 8.72 percent to $2.94 billion in October 2018 as compared to $ 2.80 billion in September 2018.

On yearly basis, during October 2018, the country saw an increase in exports as Pakistan exported $ 1.91 billion worth of goods to the world that was 1.17 percent higher than exports worth of $ 1.88 billion in the same month of last fiscal year.

However, imports registered 1 percent decline to $ 4.94 billion in the month of October 2018 as compared to $ 4.90 billion imports in corresponding month of FY17. As a result, country’s trade imbalance shrunk by 2.36 percent in October 2018 to $ 2.93 billion, as against $3.00 billion in October 2017.

Published in Daily Times, November 13^th 2018.