Merchandise trade deficit shrinks by 26.6%

The government’s policy of curtailing unnecessary imports has started to pay dividends as the country’s merchandise trade deficit for the first four months of the ongoing fiscal shrank by 26.6% to $11.47 billion against $15.62 billion in the same period of the FY2021-22.

Imports in July-Oct 2022-23 shrank by 16.2% to $21.02 billion from $25.1 billion in the same period last year; however, the exports edged up 0.94% to $9.55 billion against $9.46 billion in the same period last year.

Read more: Trade deficit likely to increase by $3bn amid flood devastation

On the other hand, Pakistan imported nearly 27.2% fewer goods in October 2022 and sold 3.77% less products abroad compared to the corresponding month of the last fiscal, according to Pakistan Bureau of Statistics (PBS) data.

Exports in October 2022 fell by 3.77% to $2.37 billion from $2.464 billion in the same month a year ago, while imports dropped from 27.2% to $4.636 billion from $6.37 billion in October 2021.

In October, the trade deficit was reduced by 42% to $2.265 billion, which is a 23-month low. The deficit was $3.91 billion in the same month last year. Comparing monthly trade performance with the previous month (September), goods exports in October 2022 fell 3.1% from $2.45 billion in the previous month, while imports slumped 13.3% compared to September imports of $5.35 billion.

However, it is encouraging to note that imports have been trending downwards since the start of this fiscal year as in July imports contracted 10.4%, in August 7.7%, in September 19.7% and now in October they decreased 27.2% over their respective corresponding months of last year, the statistical office’s trade bulletin revealed.