Official expresses concern over high trade deficit

APBF president says Pakistan has policy of import substitution rather than export promotion

LAHORE: Pakistan’s trade deficit reached a record level of $30 billion in 2016-17, demonstrating a jump of 42% compared to the last financial year. Exports have declined by 3% to $18.5 billion while imports have gone up by 21% to $48.5 billion.

“This decline is disconcerting, since our country has never faced imports being two-and-a-half times as much as current exports,” said All Pakistan Business Forum (APBF) President Ibrahim Qureshi, expressing concern over the worrying numbers.



“Pakistan faces this unprecedented trade deficit despite the prevalence of low international prices of our biggest import; oil.”

A number of reasons can be attributed to the drastic drop in exports, which includes structural factors and erroneous policies.

Unlike the Middle East or East Asia, Pakistan has followed a traditional policy of import substitution rather than export promotion. Therefore, little emphasis has been given on broadening exports that have remained over-reliant on textiles.

Exports of cloth, cotton yarn and value-added textiles make up to almost 60% of our total exports.



“The economic charts of Pakistan stand on an unsatisfactory level at the moment. I urge the government and policymakers to encourage private sectors to play their roles in putting the economy back on the right track,” Qureshi added.

“We should fully avail the opportunities created due to the worldly chain of events, such as the global decline in oil prices and the China-Pakistan Economic Corridor.”

Published in The Express Tribune, August 1^st, 2017.

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