Trade deficit widens by 33.97pc in first half

January 10, 2015

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Imran Ali Kundi

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ISLAMABAD - Pakistan’s trade deficit has widened by 33.97 percent during first half (July-December) of the ongoing financial year over the corresponding period of previous year due to the continuous decline in exports and ever increasing growth in imports.
The trade imbalance-gap between exports and imports, has recorded at $12.3 billion during first half (July-December) of the current fiscal year (FY2015) as against $9.054 billion of the same period last year, showing increase of 33.97 percent. The data of Pakistan Bureau of Statistics showed that exports have decline against imports, which showed massive increase resulting in widening of the trade deficit.
The country’s imports bill is still on the increasing side despite oil prices had significantly declined in the international market. Pakistan has imported goods worth of $24.203 billion during July-December FY2015 against $21.671 billion of the same period last year showing growth of 11.68 percent.
However, exports went down by 4.31 per cent to $12.073 billion in July-December of FY 2015 from $12.617 billion of the corresponding period previous year. Therefore, the country’s trade imbalance remained $12.3 billion during July-December FY2015 as against $9.054 billion of the corresponding period previous year.
Analysts believe the increasing trade deficit is alarming, as it could pressure the balance of payment and the rupee.
Month on month
According to the PBS data, exports registered an increase of 9.66 percent, as country exported goods worth $2.156 billion in December 2014 as against $1.966 billion of its previous month of November 2014. Meanwhile, the imports recorded increase of 6.31 per cent, as imports stood at $3.859 billion in December 2014 as compared to $3.63 billion of the November 2014. Therefore, the trade deficit has shown decline of 2.34 per cent, as it was recorded at $1.73 billion in December 2014 as against $1.664 billion of November 2014.
Year on year
Meanwhile, the Pakistan Bureau of Statistics suggested that exports went down by 4.64 percent in December 2014 as against exports of the same month of the previous year. Exports were recorded at $2.156 billion in December 2014 as compared to $2.261 billion of December 2013. However, the imports recorded massive increase of 8.37 percent, as imports were registered at $3.859 billion in December 2014 against $3.561 billion of December 2013. Therefore, the trade imbalance was recorded at $1.73 billion in December 2014 as compared to $1.3billion of December 2013, showing an increase of 31 percent.