Pakistan’s trade deficit widened by nearly $2 billion in the first four months of the fiscal year compared with the same period last year, according to the latest Pakistan Bureau of Statistics figures
By Pervaiz Mughal
ISLAMABAD: Pakistan’s trade deficit widened by 16 per cent to $14.6 billion during the first four months of the current fiscal year, as imports continued to rise sharply while export growth remained sluggish, adding to pressure on the country’s external financing position.
The latest figures released by the Pakistan Bureau of Statistics showed that the trade gap increased by around $2 billion between July and October compared with the corresponding period last year. Imports reached $26 billion, marking an increase of $2.9 billion, or 12.5 per cent, from a year earlier.
Exports, meanwhile, showed only modest improvement. Total export earnings stood at $11.4 billion during the four-month period, an increase of just $890 million compared with the same period last fiscal year. The widening gap reflected the country’s continued difficulty in expanding overseas sales at a pace that could match the rising import bill.
On a monthly average basis, Pakistan imported goods worth around $6.5 billion, while exports generated approximately $2.8 billion. The imbalance highlighted the scale of the challenge facing policymakers as they sought to strengthen foreign exchange earnings and reduce dependence on external financing.
The growing trade deficit also raised concerns about Pakistan’s ability to meet its external payment obligations without seeking further borrowing or extensions on existing loans. The pressure came at a time when the government was attempting to maintain foreign exchange reserves and meet repayment commitments to bilateral and commercial creditors.
The trade figures emerged after Finance Minister Muhammad Aurangzeb disclosed that Saudi Arabia had extended the maturity of another $3 billion in loans to Pakistan last month. The extension provided additional breathing space for the country’s external financing position but also underlined its reliance on continued support from friendly countries. Finance Secretary Imdadullah Bosal told a parliamentary committee that Pakistan faced substantial external debt repayment obligations. He said the government would seek extensions on bilateral and commercial loans while continuing efforts to arrange fresh foreign financing to maintain foreign exchange reserves.
