Islamabad, March 3, 2025 – Pakistan’s trade deficit has expanded by 6.33% during the first eight months (July – February) of the fiscal year 2024-25, according to data released by the Pakistan Bureau of Statistics (PBS) on Monday.
This widening trade deficit highlights the growing gap between the country’s exports and imports, posing challenges for economic stability.
The PBS reported that the trade deficit surged to $15.78 billion in the first eight months of the current fiscal year, up from $14.84 billion recorded in the corresponding period of the previous fiscal year. This increase reflects an imbalance in the trade sector, as the growth in imports outpaced the rise in exports.
During the period under review, Pakistan’s exports saw an increase of 8.17%, reaching $22.02 billion, compared to $20.36 billion in the same months of the last fiscal year. The rise in exports is a positive development, indicating a boost in the country’s trade activity; however, it was overshadowed by a more significant rise in imports.
Meanwhile, imports rose by 7.4% to $37.80 billion during July – February of the ongoing fiscal year, compared to $35.20 billion in the corresponding period of the previous year. The higher import bill contributed to the widening trade deficit, putting additional pressure on the country’s foreign exchange reserves and trade balance.
On a year-on-year (YoY) basis, Pakistan’s trade deficit in February 2025 widened sharply by 33.43%, reaching $2.30 billion, compared to $1.72 billion in February 2024. This substantial increase highlights persistent trade imbalances, despite efforts to enhance exports and reduce import dependency.
The country’s exports on a YoY basis in February 2025 declined by 5.57%, falling to $2.44 billion, down from $2.58 billion in February 2024. The decline in export earnings underscores the need for policy interventions to boost trade competitiveness. Meanwhile, imports rose by 10% in February 2025, reaching $4.79 billion, compared to $4.31 billion in the same month of the previous year.
The growing trade deficit underscores the necessity for structural economic reforms, trade diversification, and incentives to enhance export performance. Policymakers must focus on reducing the country’s trade gap by curbing unnecessary imports and promoting domestic industries to improve Pakistan’s overall trade balance.