Pakistan’s trade deficit reaches all-time high

[FalconsForPeace]

At the end of the five-year term of Pakistan Muslim League (PML-N) led government, Pakistan’s trade deficit reached all-time high at $37.6 billion from $20.4 billion in Fiscal Year 2017-18.

Before PML-N’s government, exports from Pakistan stood at $24.5 billion by the end of FY13, while the import bill of the country was recorded at $44.9 billion.

It is to be noted that Pakistan acquired the GDP plus status from the European Union in December 2013, granting member states duty-free access to 96 percent of Pakistani exports to the European Union (EU).

The State Bank of Pakistan (SBP) said that Pakistani exporters benefited less compared to the other countries.

Meanwhile, Pakistani exports rose by 13.74 percent in FY18 from a year ago, boosted by higher shipments of textiles, food items and POL products, data from Pakistan Bureau of Statistics (PBS) showed Wednesday.

However, the country largely missed the export target of $35 billion, which the federal government had set in the three-year Strategic Trade Policy Framework 2016-18.

Despite strengthening export growth and decelerating import growth, Pakistan’s trade deficit reached a historic high of $ 37.6 billion in FY18 from $32.4 billion in the preceding fiscal year. A broad-based increase in export quantum was overshadowed by an upsurge in import quantum, with higher commodity prices further aggravating the situation.



According to the data of PBS, the country’s exports showed 13.74 percent growth to $23.2 billion in FY18, as compared to $20.4 billion in FY16. Similarly, import bill surged by 15.10 percent, as the total import receipts of the country settled at $60.8 billion in FY18 while it was $ 52.9 in previous fiscal.

The SBP in its third quarterly report for FY18 said three major factors explain the growth in multiple exporting sectors. First, higher domestic production of cotton, rice and sugar, and surplus wheat stock, ensured that the country had exportable surplus available this year.

In case of textiles, Pakistani exporters to the EU were able to make most out of the dual advantage of the Pakistani rupee depreciation against the Euro and the zero-duty access under GDP Plus.

Moreover, a strengthening consumer demand in the US, as reflected by growing share of consumption in real GDP growth and rising retail sales of clothing and accessories has boosted the demand for clothing imports in the country.

https://dailytimes.com.pk/266132/pakistans-trade-deficit-reaches-all-time-high/

 

[TopCat]

Alarming situtation.
A country export 20 billion dollar whereas its trade deficit is double the value of its export. How stupid it could get?

 

[TheNoob]

Alarming situtation.
A country export 20 billion dollar whereas its trade deficit is double the value of its export. How stupid it could get?

Use this to determine the average intelligence of our people. :V

 

[Skull and Bones]

Everything will be fine after election.

 

[waraich66]

Trade Deficit decreased to 5 BUSD which is great news for Pakistanis !

 

[HammerHead081]

Even with rupees value very down, we don't have the industry to take advantage of this. So depreciation of rupees doesn't helps significantly.

 

[CrazyZ]

A constant problem has been that elected Governments have pursued short term fixes and ignored making the hard decisions needed to pull out of the situation. Relying on imports is an easy way to boost gdp growth and generate tax revenue. Unfortunately it's done at the expense of forex reserves and debt....a problem for the next government.

That's why I argue that a council of economic sector experts be created as part of the NSC. They would be affirmed by the legislature and serve fixed terms independent of the PM office and backed by the military.