KARACHI: Non-textile exports logged double-digit decline in March as the pandemic lockdown brought economic activities to almost a grinding halt during the month, adversely hurting port operations, the latest official data showed.
In March, non-textile exports fetched $774,218 million, down 10 percent month-on-month and falling 12 percent year-on-year, according to the Pakistan Bureau of Statistics (PBS). Non-textile exports amounted to $866,279 in February 2020 and $886,145 in February 2020.
The decline in foreign earnings was more pronounced in the last 10 days of March when the lockdown was announced to contain spread of the novel coronavirus. Indifference towards economic fallout of shutdown led to financial turbulence in every sectors of the economy: formal and informal.
Ports, which are the lifeline of foreign trades, faced the ramifications of political differences among the federal and provincial government with the former in favor of port operation and the latter adamant to block movement to and from the country’s sea and land borders. Food sector that is the second foreign revenue earner after textile saw exports fall 23 percent year-on-year and decrease 15 percent month-on-month to $362,537 in March. In the group, rice exports slid 15 percent year-on-year, but increased 7.2 percent month-on-month.
In March, textile exports dropped 4.5 percent year-on-year and sharply fell 18.4 percent month-on-month to $1.039 billion. Overall, monthly exports declined 8.1 percent year-on-year and decreased 15.3 percent month-on-month. Exports are expected to show some recovery in the last quarter of the current fiscal year if the government-announced incentives are materialized on time for the upkeep of lockdown-inflicted trade and industry.
The government stepped up efforts to settle outstanding refund payments of exporters, while, though belatedly, broadening definition of essential industries exempted from the lockdown. The State Bank of Pakistan slashed interest rates three times to 9 percent from 13.25 percent in a brief period of one month. Refinancing schemes were unveiled to ease liquidity crunch of industrialists. The central bank has never been this much proactive in the history in rolling out monetary measures back-to-back.
In July-March, food exports increased 1.4 percent to $3.4 billion. Textile exports also tracked up 4.2 percent to $10.4 billion during the period under review. Overall, exports increased 2.2 percent to $17.5 billion in the first nine months of the current fiscal year, according to PBS.
Pakistan’s struggling economy needs rational policymaking and implementation without a trade-off between health and economy. Growth already tumbled to 3.3 percent last fiscal year from 5.5 percent and widely expected to fall below the positive trajectory this fiscal year. Exports are vital to keep the external debt burden minimal.