ISLAMABAD: Import restrictions imposed by Pakistan resulted in massive 27 per cent contractions in trade deficit during first four months (July – October) 2022/2023, according to official data released on Wednesday.
The trade deficit narrowed to $11.47 billion during first four months of the current fiscal year as compared with the deficit of $15.62 billion in the corresponding months of the last fiscal year, Pakistan Bureau of Statistics (PBS) said.
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The trade deficit contraction is largely sharp decrease in import bill of the country during the period under review. Import payment of the country were at $21.02 billion during July – October 2022/2023 as compared with $25.08 billion in the same period of the last fiscal year.
The fall in import bill may be attributed to restrictions imposed by the government regarding opening of letter of credit. Recently, Finance Minister Ishaq Dar had announced to increase the threshold payment for LCs from $50,000 to $100,000. Industry sources said that due to scarcity of dollars in the market, most of the banks were not opening LCs for import payments.
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Exports of the country, however, grew with a small margin during the period. The exports recorded increase to $9.55 billion during first four months of the current fiscal year as compared with $9.46 billion in the same months of the last fiscal year.
The trade deficit recorded a contraction of 42 per cent in the month of October 2022 when compared with same month of the last year. The trade deficit fell to $2.26 billion in October 2022 when compared with the deficit of $3.9 billion in the same month of the last year.
READ MORE: Pakistan’s trade deficit narrows by 18% in July 2022
The import bill plummeted by 27 per cent to $4.63 billion in the month of October 2022 when compared with $6.37 billion in the same month of the last year.
On the other hand, exports also fell by 3.77 per cent to $2.37 billion in the month under review as compared with $2.46 billion in the corresponding month of the last year.
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