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Exports fall 4.5pc to $2bln in February

Business

March 2, 2021

ISLAMABAD: Pakistan’s exports fell 4.5 percent year-on-year to $2 billion in February after maintaining the growth pace for five months, although they remained at the pre-COVID monthly level.

Adviser to the Prime Minister for Commerce and Investment Razak Dawood said the exports have crossed the $2 billion mark for the fifth consecutive months. However, exports decreased from $2.14 billion in February last.

“For eight months (July-February 2020/21) of the current financial year, our exports increased by 4.2 percent at $16.3 billion as compared to $15.6 billion during July-February 2020,” Dawood wrote on Twitter.

“We wish to congratulate our exporters for their hard work in earning the foreign exchange for the country and urge them to market their exports even more aggressively,” he added. Exports recovered to pre-COVID monthly level of $2 billion in September and kept up in October and November. The recovery was due to low value-added apparels and home textiles.

Annual exports are expected between $23 to 24 billion this fiscal year, according to industry estimates. Improvements are mainly coming from textile exports, both in terms of quantity and prices.

The central bank projects export values in the range of $23.4 to 23.8 billion in FY2021 – higher than the $22.5 billion recorded in FY2020. The government set an annual export target of $22.7 billion.

Exports have also recovered to their pre-COVID monthly level of around $2 billion since September, with a broad-based recovery in export volumes recorded in almost all categories in December.

While remittances and exports continued to grow steadily, the trade deficit rose due to a rise in imports of machinery and industrial raw material, in line with the pick-up in economic activity.

Dawood didn’t share imports number. Trade deficit widened around nine percent to $15 billion in the July-January period as exports increased six percent to $14.3 billion and imports rose 7.2 percent to $29.3 billion.

Exports rebounded in September after a double-digit fall in August as lifting of lockdown led to clearance of export orders in backlog.

Exports showed first recovery in July after consecutive downtrends since March amid coronavirus lockdown. Ease in lockdown paved way for clearance of orders stuck on ports.

Exports continued to show contraction since the government took charge. Trade deficit narrowed 27.1 percent to $23.1 billion in the last fiscal year of 2019/20, but the reduction was mainly caused by suppressing imports rather than export sector’s recovery. Exports declined 6.8 percent to $21.3 billion, whereas imports sharply fell 18.6 percent to $44.5 billion during the last fiscal year.