Islamabad, March 1, 2024 – Pakistan has achieved a remarkable 30% contraction in its trade deficit during the first eight months (July – February) of the fiscal year 2023-24, according to data released by the Pakistan Bureau of Statistics (PBS) on Friday.
This positive development is largely attributed to a significant reduction in the country’s import bill.
The trade deficit for the first eight months of the current fiscal year is reported at $14.87 billion, a substantial decrease from the deficit of $21.30 billion recorded during the corresponding months of the last fiscal year. This notable contraction signals a positive trend in Pakistan’s economic landscape.
The substantial fall in the import bill is a key factor contributing to this achievement. Pakistan’s import bill experienced a noteworthy decline of 12%, standing at $35.22 billion during July-February 2023-24, compared to $40 billion in the same period of the previous fiscal year. This decline in imports has played a pivotal role in narrowing the trade deficit.
In contrast, the country’s exports recorded a 9% increase during the period under review. Exports rose to $20.35 billion during the first eight months of the current fiscal year, showcasing growth from $18.67 billion in the same period of the last fiscal year.
However, on a month-on-month (MoM) basis, exports saw a decline of 8% to $2.57 billion in February 2024 compared with $2.79 billion in January 2024. Concurrently, on a MoM basis, the import bill fell by 10% to $4.28 billion in February 2024 compared with $4.77 billion in January 2024. This resulted in a 13.50% reduction in the trade deficit to $1.71 billion in February 2024 compared with the deficit of $1.98 billion in the previous month.
On a year-on-year (YoY) basis, exports exhibited a robust growth of 17.54%, reaching $2.57 billion in February 2024 compared with $2.19 billion in the same month of the previous year. Meanwhile, imports registered an increase of 9% to $4.28 billion in February 2024 compared with $3.93 billion in February 2023. Despite this, the trade deficit on a YoY basis recorded a 2% decline to $1.71 billion in February 2024 compared with a deficit of $1.75 billion in the same month of the previous year.
This impressive performance in narrowing the trade deficit reflects positive economic management, increased competitiveness in the global market, and effective fiscal policies. The focus now turns to sustaining and building upon this momentum, fostering an environment conducive to further export growth and import moderation. Policymakers and industry stakeholders will closely monitor these trends to ensure the continued stability and resilience of Pakistan’s external trade sector.
