January exports cross $2bln mark fourth time in a row

ISLAMABAD: Pakistan’s monthly exports continued to stay above the $2 billion dollar mark for the fourth consecutive months in January, commerce adviser said on Monday as exporters are regaining their losses with trade stimulus.

“Exports have maintained growth and for the first time in 8 years the exports have crossed the $2 billion mark in four consecutive months. Our export for January 2021 is up by 8 percent to $ 2.14 billion, compared to $ 1.98 billion in January 2020,” Razak Dawood, adviser on commerce and investment wrote on Twitter. The exports for July-January 2020-21 have increased by 5.5 percent to $14.2 billion as compared to $13.5 billion during the corresponding period a year earlier.

The economy facing a challenge to stay afloat and catch the lost speed is slowly coming back to the normalcy with the government showing willingness to support businesses. Over the past couple of months, it showed understanding to demands of the trade and industry hurt affected by the global economic debacle related to the coronavirus pandemic. The central bank offered a score of financing schemes with mark-up subsidy, while slashing interest rate to 625 basis points to 7 percent.

The commerce adviser assured the business community of a continued support to grow. “Our cumulative exports for seven months of FY 2020-21 are showing a rising trend. Our exporters have achieved this feat despite difficulties created by COVID pandemic, regional export situation and contraction in major markets,” said Dawood. Exporters please go full speed ahead in exporting your products and in case of any hurdle, inform MOC [ministry of commerce].”

Exports have continued to show uptrend since July last when they hit rock bottom. Since then exports recovered with minor contraction in July-September, and 0.3 percent, 2.1 percent, and 5.1 percent growth in in July-October, July-November and July-December, respectively. While growth in exports is still modest, the foreign exchange revenue is somehow helping neutralize the of debt payment burden. Remittances crossing two billion dollars a month are the main and biggest costless source of foreign exchange flowing in to support balance of payment. The finance ministry said the current account posted a surplus of $1.1 billion (0.8 percent of GDP) for July-December FY2021. In December, current account turns deficit ($662 million) due to imports of essential food items, capital goods, oil, and industrial raw material owing to the domestic economic recovery. “Looking forward, depending on these explanatory factors, imports may remain $4.5 – $5 billion in next month. Exports are expected to stabilise around current levels,” the ministry said in a latest report. “But in the baseline scenario, the trade balance is not expected to further deteriorate. Remittance inflows remain strong and continue to provide strong support to the financing of the trade deficit.”