According to trade figures, released here on Wednesday by the Pakistan Bureau of Statistics, the trade deficit stood higher by $3.2 billion or 38.5 per cent to $11.5 billion in six months (July-December) of the current fiscal year compared to the corresponding period of last year.
Imports grew 18.9 per cent at $22.7 billion, about $3.6 billion more than imports in the corresponding period of last fiscal year. Exports during the period were $11.3 billion, only $422 million or 3.9 per cent higher over last year. In five months, the growth in exports was 7.7 per cent.
For the current fiscal year, the government has estimated 13 per cent growth in imports and 3 per cent rise in exports. However, the State Bank of Pakistan has projected a negative growth in exports.
Estimates of the current account deficit – the gap between external receipts and payments – widely differ. The finance ministry sees a deficit of $2.7 billion, the International Monetary Fund forecast a gap of $3.9 billion while the central bank puts the figure in the range of $5.2 to $6 billion.
In five months (July-November), the current account deficit stood at $2.2 billion, says the central bank.
“First-half data indicates that gains made in the current account in the last fiscal year will not only be wiped out, but also the deficit will widen substantially,” said Muzzamil Aslam, an analyst with JS Global Capital.
He said imports were increasing both in value and volume because of soaring oil prices following tension between the US and Iran and rise in demand of petroleum products in the country due to gas outages.
Aslam said exports were declining due to a 60 per cent drop in cotton prices in the international market.
Other analysts point out that a massive depreciation of the rupee against the dollar was also contributing significantly to the increase in the import bill.
Monthly data
In December, exports dipped 11.5 per cent while imports rose 13.6 per cent, widening the trade gap by 45 per cent over the corresponding month of previous year.
In the month, exports totalled $1.85 billion, lower by $240 million than exports in December 2010. Imports stood at $4.3 billion, $510 million more than imports in the same period last year. It was probably for the first time in recent history that the import bill has crossed $4 billion in a month.
The trade deficit widened to $2.4 billion, $750 million more than the gap in the same month last year.
December was the third consecutive month when exports slipped into the negative zone and was the fifth consecutive month when they stood below $2 billion.
However, month-on-month figures depict a balanced trend in international trade. Exports rose to $1.85 billion in December, $302 million or around one-fifth higher than exports in November. Imports grew to $4.3 billion, 14.3 per cent higher than November. The monthly trade gap widened slightly by around 10 per cent at $2.4 billion.
Published in The Express Tribune, January 12th, 2012.
COMMENTS (4)
Comments are moderated and generally will be posted if they are on-topic and not abusive.
For more information, please see our Comments FAQ
I dont understand this....our textiles are the best in the world, better than India, our kinnows and mangoes are world's finest...so is our animal hides and meat...we score way over India on key economic patterns and yet our exports keep falling....may be the west is conspiring to under report our exports so that they can put us down
The trade deficit has swelled four times Vs last year shows obvious apathy of our Govt & the power/Gas outage has compelled the industrialists to substitute with wood to honour their foreign orders.
Stone age has begin in Pakistan
Rupee going down in value combined with power outages which interrupt mfg is a lethal combo. It cost you more to import items and the power outages close down your mfg facilities causing your customers to switch to more dependable suppliers. This is the kind of problem that tends to escalate and feed on itself.