ISLAMABAD: Imports of energy, edible oil, Covid-19 vaccines, iron, steel, and its scrap in the first eight months of this fiscal year have doubled compared to last year, widening the trade deficit massively, Pakistan Bureau of Statistics (PBS) data showed on Saturday.
These components have not only pushed the country’s total imports to a new high, but also its goods exports-imports gap to a whopping $31.95 billion in July-February FY2022. As a consequence, the trade deficit ballooned 82.2 percent higher over $17.53 billion recorded in the same period of FY2021.
Imports, in the period under review, of petroleum products picked up 116.56 percent to $6.25 billion, LNG 105.3 percent to $3.08 billion, and purchases of medicinal products from overseas soared 407.4 percent to $3.64 billion over the same period of last year.
During these eight months, crude imports also increased 80 percent to $3.1 billion, palm oil 53.8 percent to $2.44 billion, electrical machinery 47.5 percent to $1.36 billion, iron and steel scrap 31.5 percent to $1.65 billion, iron and steel 29.4 percent to $1.97 billion, plastic materials 29.3 percent to $2.0 billion, and imports of mobile phones inched up 7.6 percent to $1.4 billion.
It is to be noted that during July-Feb 2021-22, total imports surged to $52.47 billion, while exports remained at $20.56 billion.
In the same fiscal period a year ago, imports arrived at $33.86 billion and exports $16.32 billion. Which shows a 25.95 percent growth in exports and 55 percent jump in imports.
Over the last several months, the increasing trade deficit has pressured the country’s balance of payment position. The country posted a current account deficit of $12.1 billion in the eight months (July-February) of FY2022, versus the surplus of $994 million in the same period last year.
The current account deficit declined 78 percent to $545 million in February from $2.531 billion a month ago. However, the deficit widened steeply on a year-on-year basis as it stood at $34 million in February 2021.
The country’s exports of knitwear increased 33.9 percent to $3.3 billion, readymade garments 25.1 percent to $2.52 billion, bed-wear 20.3 percent to $2.19 billion, cotton cloth 28.2 percent to $1.58 billion, rice (others) 9.87 percent to $1.11 billion, cotton yarn 43.4 percent to $815.4 million, towels 17.26 percent to $716.1 million, basmati rice 31 percent to $432.3 million, made-up article (excluding towels and bed wears) 9.9 percent to $556 million, while plastic materials exports rose 27.3 percent to $266.6 million.
Exports edged 7.88 percent higher to $2.82 billion in February 2022 over the previous month, whereas rose 36.36 percent compared to the same month a year ago. Pakistan sold goods worth $2.614 to overseas buyers in January 2022, while the monetary volume of exports in February 2021 was $2.068 billion.
Interestingly, trade performance in the 28-day February was comparatively encouraging, as exports for the first time reached $100/day this month. On Saturday, Abdul Razak Dawood, Adviser to the Prime Minister on Commerce and Investment, chaired a consultative meeting to discuss the trade trends for FY22 in the federal capital.
Officials of the Ministry of Commerce shared provisional trade figures compiled by Pakistan Bureau of Statistics (PBS). The meeting was informed that imports in February 2022 declined 2.14 percent to $5.907 billion over the previous month’s imports of $6.036 billion; however, they were reported to have increased 28.4 percent compared to $4.601 billion in February 2021.
Officials informed the PM’s aide there were signs of an easing trend in imports and an uptrend in exports. The adviser was informed that in terms of markets, Pakistan’s exports to the United States grew 25 percent, United Arab Emirates 118 percent, Netherlands 94 percent, Germany 60 percent, Italy 102 percent, Spain 90 percent, United Kingdom 27 percent, China 17 percent, Bangladesh 62 percent, and exports to Turkey climbed 157 percent. Razak in the end advised ministry officials to make necessary interventions if and when required to maintain the exports growth momentum.