The recent admission by the Pakistan Bureau of Statistics (PBS) regarding discrepancies in trade data and its subsequent efforts to reconcile figures through the Federal Board of Revenue (FBR), Pakistan Revenue Automation Limited (PRAL) and Pakistan Single Window (PSW) marks a crucial juncture in Pakistan’s economic governance.
For years, Pakistan’s trade statistics, used for both domestic policymaking and international reporting to institutions such as the WTO, the IMF and the ITC, were undermined by significant mismatches, particularly with key partners such as China. The revelation that this gap had widened to around $6 billion in the fiscal year 2024–25 shows deep structural weaknesses in data management, inter-agency coordination, and technological adaptation within the state apparatus. While the acknowledgement of error and the corrective measures now being introduced are commendable, this episode carries profound implications for Pakistan’s economic credibility, fiscal transparency, and policy planning in the years to come.
At the centre stands an outdated data extraction process that the PBS had been using to report trade statistics. According to the FBR’s internal review, the PBS had relied on a programmed query developed in 2017 to pull data from the WeBOC system, Pakistan Customs’ online clearance platform. This query, however, only captured seven categories of Goods Declarations (GDs), failing to account for at least nine additional types introduced later, including transactions under the Export Facilitation Scheme, Safe Transportation, Batch Data and Temporary Imports.
This seemingly technical oversight snowballed into a systemic distortion: as new GD types proliferated, the share of imports excluded from official reporting steadily grew from a modest 2.0 per cent (around $1 billion) in FY2020 to an alarming 12 per cent (roughly $6.5 billion) by FY2024-25. As a result, Pakistan’s import data reported to the ITC significantly lagged behind its export data, especially with China, creating a persistent gap averaging $4.5 billion annually.
While the discrepancy itself stems from technical inefficiencies, its economic and diplomatic consequences are far from trivial. International organisations such as the IMF and WTO rely on consistent and transparent trade statistics to assess compliance, monitor performance, and calibrate assistance programmes. Any inconsistency in data reporting can erode confidence in Pakistan’s fiscal management and invite unnecessary scrutiny.
During the IMF’s recent review mission to Islamabad (September 28-October 8, 2025), this issue was raised directly by the visiting team, forcing Pakistani authorities to explain the origins of the mismatch and assure corrective action. The fact that Pakistan must now resubmit reconciled data for past years highlights not just a technical correction but a reputational repair exercise, one that has implications for ongoing IMF programme evaluations, WTO trade monitoring and even credit rating assessments by international agencies. Yet, the problem extends beyond institutional embarrassment.
Inaccurate trade data distorts the very foundation of economic policymaking. Trade statistics are vital for fiscal projections, tariff rationalisation and industrial strategy design. When import values are underreported, it affects not only the estimation of customs duty revenue but also the accuracy of current account deficit calculations and inflation forecasting. For instance, underreported imports could make the trade deficit appear smaller, leading policymakers to become complacent while masking underlying pressures on the balance of payments.
Similarly, inaccurate sectoral import data can hinder the identification of import dependency trends, thereby weakening industrial policy formulation.
The under-invoicing issue, though not conclusively proven in this particular instance, has long been a structural concern for Pakistan’s trade regime. The persistent mismatch between Pakistan’s reported imports and China’s reported exports to Pakistan has often been cited as evidence of revenue leakage due to misdeclaration. This practice allows importers to evade duties and taxes, depriving the exchequer of much-needed revenue. While the current investigation suggests that the $6 billion discrepancy stemmed mainly from incomplete data capture rather than deliberate under-invoicing, the very fact that such suspicions arise reflects chronic weaknesses in enforcement, monitoring, and data transparency.
On the positive side, the coordination now emerging between PBS, FBR, PRAL and PSW signals a new era of inter-agency integration that could strengthen Pakistan’s economic governance architecture. The integration of trade data through PSW, a digital platform designed to facilitate paperless trade and real-time data exchange, can help eliminate redundancies and manual errors while improving the speed and reliability of reporting.
This move aligns with Pakistan’s broader commitments under the WTO’s Trade Facilitation Agreement and the UN’s Framework Agreement on Facilitation of Cross-Border Paperless Trade in Asia and the Pacific. By aligning statistical systems with digital trade infrastructure, Pakistan can not only improve accuracy but also enhance its competitiveness in global trade rankings.
This development could also enhance the effectiveness of fiscal and monetary policy coordination. The State Bank of Pakistan (SBP) currently calculates the trade deficit based on financial instrument (FI) transactions executed by banks for imports and exports. While the SBP’s method ensures accuracy in terms of actual foreign exchange flows, the PBS data provides the physical trade perspective. Harmonising these two datasets through digital integration would allow policymakers to obtain a more holistic view of the external sector, combining financial and customs dimensions of trade. Over time, this could help identify anomalies, track illicit financial flows and better manage the balance of payments.
However, the transition will not be without challenges. The reconciliation process will expose years of accumulated discrepancies, requiring complex recalibration of national accounts and reporting to international institutions. This may lead to temporary inconsistencies in published figures, potentially affecting Pakistan’s credibility in the short term. The increased scrutiny from the IMF and other international bodies could also result in more stringent conditionalities tied to statistical transparency and data management reforms. While such pressure could catalyse institutional reform, it also risks adding administrative burdens to already stretched agencies like the PBS and FBR.
Looking ahead, the success of this reconciliation effort will depend on how effectively Pakistan institutionalises data governance reforms. It is not enough to correct past figures; the government must ensure that data reporting protocols are regularly updated in line with evolving customs procedures and technological upgrades. This requires a formal mechanism for coordination among PBS, FBR, SBP and PSW, ideally overseen by a high-level Economic Data Integrity Council. Such an institutional framework could standardise definitions, data extraction methods, and reporting cycles, minimising future discrepancies.
From a macroeconomic standpoint, improved data reliability can yield significant benefits. Accurate trade statistics will enhance investor confidence, support evidence-based policymaking and improve the credibility of Pakistan’s submissions to the IMF and WTO. It could also help Pakistan negotiate better trade terms, as transparent data often underpins arguments for tariff concessions, export incentives and market access under various bilateral and multilateral arrangements.
Domestically, improved data integrity will enable the government to identify and address revenue leakages more effectively, contributing to fiscal consolidation efforts. On the downside, greater transparency may expose structural inefficiencies in Pakistan’s trade and taxation systems that were previously masked by data inaccuracies.
For example, if reconciled data reveal higher import volumes, this could widen the apparent trade deficit, inviting criticism of economic management. Similarly, evidence of systematic underreporting could lead to investigations and enforcement actions that might disrupt business operations in the short run. Nonetheless, such discomfort is a necessary price for long-term institutional maturity.
In the broader context of Pakistan’s digital transformation agenda, this episode highlights the importance of data-driven governance. As the economy becomes increasingly integrated with global value chains and digital trade platforms, the accuracy of national statistics will become a determinant of competitiveness and credibility. The integration of PSW with PBS and FBR should therefore be viewed not merely as an administrative reform but as a foundational step toward establishing Pakistan as a transparent and reliable trading partner in the international system.
Pakistan’s trade data discrepancy saga is both a cautionary tale and an opportunity. It highlights the risks of bureaucratic inertia and technological neglect, but also opens a pathway toward more modern, integrated, and accountable statistical governance. The pros – enhanced credibility, better policy design, stronger inter-agency coordination and improved compliance with global standards – clearly outweigh the cons of temporary disruption and increased scrutiny.
What remains essential is sustained political will and institutional continuity to ensure that such lapses never recur. If implemented effectively, this reform could mark the beginning of a new chapter in Pakistan’s economic governance, one defined by data integrity, digital transparency and restored international confidence.
The writer is a trade facilitation expert, working with the federal government of Pakistan.
