Pakistan’s trade gap widened sharply in July-August 2026 as imports grew 13.03%, significantly outpacing the 7.04% increase in exports.
ISLAMABAD: Pakistan’s trade deficit increased by 18.11% year-on-year to $7.12 billion during the first two months of fiscal year 2026-27, as imports grew significantly faster than exports, according to data released by the Pakistan Bureau of Statistics (PBS).
The country’s trade deficit stood at $6.03 billion during July-August 2025. In rupee terms, the deficit increased by 16.02% to Rs1.98 trillion during the first two months of FY27, compared with Rs1.71 trillion in the corresponding period of the previous fiscal year.
Imports rise 13% in first two months
According to PBS data, Pakistan’s imports rose by 13.03% year-on-year to $12.58 billion during July-August 2026, compared with $11.13 billion in the same period of FY26.
In rupee terms, imports increased by 10.93%, reaching Rs3.50 trillion from Rs3.15 trillion a year earlier.
Meanwhile, exports posted a comparatively modest increase of 7.04% in dollar terms, rising to $5.46 billion during the two-month period from $5.10 billion in July-August 2025.
Exports in rupee terms increased by 4.92% to Rs1.52 trillion, compared with Rs1.45 trillion in the corresponding period last year.
The widening gap between imports and exports consequently pushed Pakistan’s overall trade deficit higher during the opening two months of the new fiscal year.
August trade deficit declines month-on-month
The PBS data also showed that the monthly trade deficit narrowed in August compared with July.
Pakistan’s trade deficit fell by 19.69% month-on-month to $3.17 billion in August 2026, from $3.95 billion in July.
In rupee terms, the deficit declined by 19.77%, from Rs1.10 trillion in July to Rs882.34 billion in August.
Exports fell by 15.01% month-on-month to $2.51 billion in August from $2.95 billion in July. In rupee terms, exports declined by 15.13%.
Imports also decreased during the month, falling 17.69% to $5.68 billion from $6.90 billion in July. In rupee terms, imports dropped by 17.79%.
Imports continue to outpace exports
On a year-on-year basis, August exports increased by 3.81% to $2.51 billion, compared with $2.42 billion in August 2025.
Imports, however, rose by a much stronger 7.38% to $5.68 billion, against $5.29 billion in August last year.
As a result, the monthly trade deficit widened by 10.38% in dollar terms, reaching $3.17 billion in August 2026 compared with $2.87 billion in the same month of 2025.
In rupee terms, the August trade deficit increased by 8.66% year-on-year.
The latest figures indicate that although Pakistan’s exports continued to register growth during the first two months of FY27, the faster expansion in imports has resulted in a significant widening of the country’s external trade gap.
The trend highlights the continued pressure from rising imports on Pakistan’s trade balance, despite a positive contribution from export growth at the start of the new fiscal year.