Trade deficit widens to $19b

[Jango]

The insane thing is that if the babu-dakus weren't as retarded and illiterate as they are, they could make bonkers more money through a productive, export-oriented economy than the pennies they're plundering today.

Bhai...2/3 saal main unhon nay retire ho jana hai. You think they plan that far ahead?

Get fat from this gravy train while it lasts...

 

[Bilal]

It truly is mind boggling how many times we do the same thing and expect different outcomes.

Suna hai Ishaq Dar ko dobara empower kerne ka soch rahay hien.

 

[Jango]

Suna hai Ishaq Dar ko empower ker rahay hien abh.

Hold that thought...let me get back to you in a week or so on that

But would not be surprised. It's a bankers/traders economy right now...and Dar definitely is in the opposing camp, he prefers to keep everything tight and managed.

Meanwhile, our great CM is using a tax payer funded jet to distribute wedding cards to the ME sheikhs

Sab maya hai.

 

[313Ghazi]

Exports drop further; imports increase at faster pace



ISLAMABAD:
Pakistan has booked over $19 billion trade deficit during the first half of the current fiscal year as exports further plunged and imports increased faster than projections on the back of trade liberalisation, keeping the external sector stability under pressure.

The Pakistan Bureau of Statistics (PBS) reported on Friday that the gap between imports and exports reached $19.2 billion during the July-December period. The deficit was nearly $5 billion, or 35%, higher than the same period of last fiscal year, according to the national data collecting agency.

The half year's deficit was also equal to two-thirds of the annual official target, indicating that the central bank may have to buy more dollars from the local market than initially planned to keep the foreign exchange reserves at reasonably comfortable levels.

The trade summary showed that exports fell against all the three monitored benchmarks — month-on-month, year-on-year and half year.

PBS stated that exports fell to $15.2 billion during the first half of the current fiscal year, down 8.7% on a yearly basis. In absolute terms, exports were $1.5 billion less than the same period of last year. Six-month exports were equal to only 42% of the annual target.

The government has cut import taxes in the budget to liberalise trade and based on World Bank's estimates, the trade liberalisation should result in 14% increase in exports compared to only a 7% rise in imports. However, the results of the first half of the fiscal year have not supported the World Bank's assumptions.

Exporters are complaining about the overvalued rupee, which according to them has eroded their profitability. The national coordinator of the Special Investment Facilitation Council last month called for making the exchange rate regime more reflective of the ground realities.

The rupee-dollar parity remained around Rs280.1 to a dollar on Friday. The central bank is letting the rupee appreciate but in a gradual fashion with gain of one or two paisa every day against the greenback.

Contrary to exports, imports grew to $34.4 billion during the July-December period, a jump of $3.5 billion, or 11.3%, compared to a year ago. Imports were equal to more than half of the annual target and were putting pressure on the external sector.

However, the central bank is offsetting the higher import cost through increased inflows of remittances and major purchases of foreign currency from the local market.

PBS stated that exports further decreased to $2.3 billion in December, down $594 million, or 20.4%, from the same month of last year. It was the fifth consecutive month of decline in exports.

Imports grew 2% to over $6 billion in December. It was the sixth consecutive month when imports stayed above $5 billion and for the first time crossed $6 billion in the current fiscal year. In absolute terms, imports increased $118 million last month.

As a result, the trade deficit widened one-fourth to $3.7 billion, up $712 million. On a month-on-month basis, the trade deficit also increased 28% due to the reduction in exports and the double-digit increase in imports.

As exporters were already struggling to remain globally competitive, they faced yet another challenge at the hands of the Federal Board of Revenue (FBR). The tax machinery has directed its field formations to pick at least 70 exporters for scrutiny of their income tax returns.

The FBR stated that an analysis carried out at its headquarters revealed that a significant number of exporters, associations of persons and companies substantially reduced their declared taxable income for tax year 2025 after the taxation regime for export proceeds was modified from the final tax to the minimum tax, according to the FBR's instructions.

These instructions showed that all field formations were directed to closely examine the declarations of major exporters falling within their respective jurisdictions to ascertain whether there was any abnormal reduction, inconsistency or change in declaration patterns after the amendment.

However, Pakistan Retail Business Council Chairman Ziad Bashir complained to the prime minister about the FBR's action. "At a time when Pakistan's export sector is already under stress owing to some of the highest effective tax burdens, energy tariffs, interest rates and financing costs in the region, the issuance of such broad, open-ended scrutiny instructions sends a deeply troubling signal to the business community," Ziad wrote to the PM.

The FBR was forced to give a public explanation after the hue and cry made by the exporters. In a press statement issued on Thursday, the FBR said "in order to mitigate the possibility of any bonafide or other errors, the field formations were directed to pursue the returns and process them in accordance with the law, wherever any legal inconsistency is identified."

Conducting desk audits of returns and ensuring compliance with tax laws is the statutory and primary responsibility of the FBR, it added. The FBR said that to prevent any inconsistency, misuse or undue inconvenience to taxpayers, this exercise has been initiated under the supervision of the FBR headquarters.

Export led economy according to the space agency propaganda uncle.

 

[puttputt]

Export led economy according to the space agency propaganda uncle.

Exports = people wanting to leave the country.

 

[Owaiz]

Trade deficit widening, in itself, is not necessarily bad. If it was being driven by increasing imports of machinery or NVIDIA chips or even high quality consumer goods, it would be a positive signal. Instead, the primary driver is a collapse in exports despite the regime claiming that it has secured an excellent trade deal with the US. Interestingly, India which is facing 50% tariffs in the US, has seen its exports go up in the same period.

The situation is only going to worsen next fiscal when duties on American agricultural imports will be cut to zero and Pakistan's farmers, especially the small ones, will struggle to keep afloat.

 

[Pakistani Dragon]

Your own chart exposes you.

1. Care to explain why the current account deficit increased by 85%+ between the start and finish of your babu daku's term from 2013 to 2018?

Duh, there's no Current Account mentioned in my table. There's Trade Balance though. Do you know the difference between Current Account and Trade Balance, puttputt?

2. In PTI's term, the CAD was on a gradual decrease from 2018 to 2020, but rebounded heavily, resulting in a massive spike.

Are we discussing Current Account Deficit or Trade Deficit?

FYI, Trade Deficit is not automatically mean Current Account Deficit.

We had a large trade deficit last year, but the current account was in surplus.

This is true. But what you didn't mention was that it was around this time that the Russia-Ukraine War began, global supply chains were disrupted (leading to inflationary spikes), and this, in turn, drove an abnormal increase in import costs.

You also forgot to mention the usual Crona Rona Dhona.

But during the PTI's term, imports declined gradually, and exports rose gradually, the opposite of your 2013-2018 term.

Financial Year​	Government (60 months)	Combined Exports​	Combined Imports​	Trade Balance​
2013–2014​	PML-N​	$30.420 billion	$49.658 billion	-$19.238 billion
2014–2015​	PML-N​	$29.977 billion	$50.166 billion	-$20.189 billion
2015–2016​	PML-N​	$27.314 billion	$49.847 billion	-$22.533 billion
2016–2017​	PML-N​	$27.906 billion	$58.512 billion	-$30.606 billion
2017–2018​	PML-N​	$30.690 billion	$68.176 billion	-$37.486 billion
Total​	-​	$146.307 billion​	$276.359 billion​	$130.052 billion​

Financial Year​	Government (45 months)	Combined Exports​	Combined Imports​	Trade Balance​
2018–2019​	PTI​	$30.374 billion	$62.835 billion	-$32.461 billion
2019–2020​	PTI​	$27.843 billion	$52.172 billion	-$24.329 billion
2020–2021​	PTI​	$31.437 billion	$62.556 billion	-$31.119 billion
2021–2022​	PTI / PDM​	$39.512 billion	$84.453 billion	-$44.941 billion
Total​	-​	$129.166 billion​	$262.016 billion​	$132.85 billion​

I don't see any miracles happening, do you?

Have you also considered Cartoon-e-Azam Imran Khan importing in huge volumes (at Pakistan's expense) just to re-export it to Afghanistan (in lower price) from September 2021?

3. The current CAD is more of a reflection of a poor household, i.e., its ability to earn (export) has diminished and, as a result, so has its ability to buy (import). In absence of hard-currency injections, the imports will remain low.

Which Current Account Deficit exactly are you talking about when we had Current Account Surplus for the financial year 2024-2025?

However, should hard-currency injections (e.g., loans, investment) come, your babu-dakus will, 100%, drive imports up, as they did before in 2013-2018, on the back of Ishaq Dollar Dar's PKR-fixing loans and FDI from CPEC.

Did you forget to account for the $12.5 billion of frozen debt that became payable after it's 15-year grace period ended?

Bills from a bygone era: 15 years after 9/11, Paris Club debt finally comes due

 

[Pakistani Dragon]

Yep. Not only that, but rising imports in and of themselves are fine, provided that your exports rise in lock-step and eventually surpass imports.

One sign of 'productive imports' is the growth of importing raw materials and factory equipment, both of which go into manufacturing, which helps reduce imports (of manufactured goods, e.g., cars, medicine, etc) and also drives up exports of said goods, hence closing the CAD.

So, you can reduce CAD through dual-import and export growth, which is a good sign, actually, because it indicates that your imports are productive.

OTOH, if your CAD crashes due to dropping imports and exports, it just means you're getting poorer.

Of course, don't expect babu-dakus like @Pakistan Space Agency to know, much less speak of, economic issues in an informed, literate way.

On PDF, every PTI Shaikh Chilli is an Economic Scientist without realising they're just regurgitating the same nonsense that the ISI brainwashed them with in the first place between October 2011 - May 2021.

Here's you Current Account figures between 2013-2025. Can you please tell us what happened to Current Account in 2025 without an emotional rant?

(I've also clearly highlighted the double digits figures so you won't have a hissy fit, brother).

Pakistan's Balance of Payment History

Financial Year​	Government(s)​	Year​	Current Account​	Surplus/Deficit​
2013-2014​	PML-N​	01​	$3.185 billion​	Deficit​
2014-2015​	PML-N​	02​	$2.801 billion​	Deficit​
2015-2016​	PML-N​	03​	$4.921 billion​	Deficit​
2016-2017​	PML-N​	04​	$12.238 billion​	Deficit​
2017-2018​	PML-N​	05​	$19.254 billion​	Deficit​
2018-2019​	PTI​	01​	$13.238 billion​	Deficit​
2019-2020​	PTI​	02​	$4.349 billion​	Deficit​
2020-2021​	PTI​	03​	$2.627 billion​	Deficit​
2021-2022​	PTI / PML-N​	04​	$17.571 billion​	Deficit​
2022-2023​	PML-N​	01​	$3.545 billion​	Deficit​
2023-2024​	PML-N / Caretaker / PML-N​	02​	$2.153 billion​	Deficit​
2024-2025​	PML-N​	03​	$1.984 billion​	Surplus​

Source: State Bank of Pakistan: Balance of Payment

 

[SoulSpokesman]

There was indeed a large trade gap in the PMLN period (2013-18) but much of it was machinery imports for the CPEC projects, and as such cannot be faulted. Problem was what happened after 2018, both internally and globally

Regards

@Pakistan Space Agency @Owaiz

 

[Samlee]

On PDF, every PTI Shaikh Chilli is an Economic Scientist without realising they're just regurgitating the same nonsense that the ISI brainwashed them with in the first place between October 2011 - May 2021.

Here's you Current Account figures between 2013-2025. Can you please tell us what happened to Current Account in 2025 without an emotional rant?

(I've also clearly highlighted the double digits figures so you won't have a hissy fit, brother).

Pakistan's Balance of Payment History

Financial Year​	Government(s)​	Year​	Current Account​	Surplus/Deficit​
2013-2014​	PML-N​	01​	$3.185 billion​	Deficit​
2014-2015​	PML-N​	02​	$2.801 billion​	Deficit​
2015-2016​	PML-N​	03​	$4.921 billion​	Deficit​
2016-2017​	PML-N​	04​	$12.238 billion​	Deficit​
2017-2018​	PML-N​	05​	$19.254 billion​	Deficit​
2018-2019​	PTI​	01​	$13.238 billion​	Deficit​
2019-2020​	PTI​	02​	$4.349 billion​	Deficit​
2020-2021​	PTI​	03​	$2.627 billion​	Deficit​
2021-2022​	PTI / PML-N​	04​	$17.571 billion​	Deficit​
2022-2023​	PML-N​	01​	$3.545 billion​	Deficit​
2023-2024​	PML-N / Caretaker / PML-N​	02​	$2.153 billion​	Deficit​
2024-2025​	PML-N​	03​	$1.984 billion​	Surplus​

Source: State Bank of Pakistan: Balance of Payment

As an ACCA and CMA I will gladly tell you.Pakistan signed a heavily front loaded program by IMF that has severely restricted growth.This has resulted in demand destruction.Also from 2022 SBP has strictly rationed forex reserves by not opening L/Cs and withholding the profits of multinationals.This is one of the main reasons why Multinationals are leaving Pakistan.So this surplus is not organic but artificially generated.

 

[ziaulislam]

Exports drop further; imports increase at faster pace



ISLAMABAD:
Pakistan has booked over $19 billion trade deficit during the first half of the current fiscal year as exports further plunged and imports increased faster than projections on the back of trade liberalisation, keeping the external sector stability under pressure.

The Pakistan Bureau of Statistics (PBS) reported on Friday that the gap between imports and exports reached $19.2 billion during the July-December period. The deficit was nearly $5 billion, or 35%, higher than the same period of last fiscal year, according to the national data collecting agency.

The half year's deficit was also equal to two-thirds of the annual official target, indicating that the central bank may have to buy more dollars from the local market than initially planned to keep the foreign exchange reserves at reasonably comfortable levels.

The trade summary showed that exports fell against all the three monitored benchmarks — month-on-month, year-on-year and half year.

PBS stated that exports fell to $15.2 billion during the first half of the current fiscal year, down 8.7% on a yearly basis. In absolute terms, exports were $1.5 billion less than the same period of last year. Six-month exports were equal to only 42% of the annual target.

The government has cut import taxes in the budget to liberalise trade and based on World Bank's estimates, the trade liberalisation should result in 14% increase in exports compared to only a 7% rise in imports. However, the results of the first half of the fiscal year have not supported the World Bank's assumptions.

Exporters are complaining about the overvalued rupee, which according to them has eroded their profitability. The national coordinator of the Special Investment Facilitation Council last month called for making the exchange rate regime more reflective of the ground realities.

The rupee-dollar parity remained around Rs280.1 to a dollar on Friday. The central bank is letting the rupee appreciate but in a gradual fashion with gain of one or two paisa every day against the greenback.

Contrary to exports, imports grew to $34.4 billion during the July-December period, a jump of $3.5 billion, or 11.3%, compared to a year ago. Imports were equal to more than half of the annual target and were putting pressure on the external sector.

However, the central bank is offsetting the higher import cost through increased inflows of remittances and major purchases of foreign currency from the local market.

PBS stated that exports further decreased to $2.3 billion in December, down $594 million, or 20.4%, from the same month of last year. It was the fifth consecutive month of decline in exports.

Imports grew 2% to over $6 billion in December. It was the sixth consecutive month when imports stayed above $5 billion and for the first time crossed $6 billion in the current fiscal year. In absolute terms, imports increased $118 million last month.

As a result, the trade deficit widened one-fourth to $3.7 billion, up $712 million. On a month-on-month basis, the trade deficit also increased 28% due to the reduction in exports and the double-digit increase in imports.

As exporters were already struggling to remain globally competitive, they faced yet another challenge at the hands of the Federal Board of Revenue (FBR). The tax machinery has directed its field formations to pick at least 70 exporters for scrutiny of their income tax returns.

The FBR stated that an analysis carried out at its headquarters revealed that a significant number of exporters, associations of persons and companies substantially reduced their declared taxable income for tax year 2025 after the taxation regime for export proceeds was modified from the final tax to the minimum tax, according to the FBR's instructions.

These instructions showed that all field formations were directed to closely examine the declarations of major exporters falling within their respective jurisdictions to ascertain whether there was any abnormal reduction, inconsistency or change in declaration patterns after the amendment.

However, Pakistan Retail Business Council Chairman Ziad Bashir complained to the prime minister about the FBR's action. "At a time when Pakistan's export sector is already under stress owing to some of the highest effective tax burdens, energy tariffs, interest rates and financing costs in the region, the issuance of such broad, open-ended scrutiny instructions sends a deeply troubling signal to the business community," Ziad wrote to the PM.

The FBR was forced to give a public explanation after the hue and cry made by the exporters. In a press statement issued on Thursday, the FBR said "in order to mitigate the possibility of any bonafide or other errors, the field formations were directed to pursue the returns and process them in accordance with the law, wherever any legal inconsistency is identified."

Conducting desk audits of returns and ensuring compliance with tax laws is the statutory and primary responsibility of the FBR, it added. The FBR said that to prevent any inconsistency, misuse or undue inconvenience to taxpayers, this exercise has been initiated under the supervision of the FBR headquarters.

Its basically a collapse in exports and FDI

worse 3 years in last 50 years

But desi liberals will say all is good and ik was bad

 

[puttputt]

Duh, there's no Current Account mentioned in my table. There's Trade Balance though. Do you know the difference between Current Account and Trade Balance, puttputt?


Are we discussing Current Account Deficit or Trade Deficit?

FYI, Trade Deficit is not automatically mean Current Account Deficit.

We had a large trade deficit last year, but the current account was in surplus.



You also forgot to mention the usual Crona Rona Dhona.

Financial Year​	Government (60 months)	Combined Exports​	Combined Imports​	Trade Balance​
2013–2014​	PML-N​	$30.420 billion	$49.658 billion	-$19.238 billion
2014–2015​	PML-N​	$29.977 billion	$50.166 billion	-$20.189 billion
2015–2016​	PML-N​	$27.314 billion	$49.847 billion	-$22.533 billion
2016–2017​	PML-N​	$27.906 billion	$58.512 billion	-$30.606 billion
2017–2018​	PML-N​	$30.690 billion	$68.176 billion	-$37.486 billion
Total​	-​	$146.307 billion​	$276.359 billion​	$130.052 billion​

Financial Year​	Government (45 months)	Combined Exports​	Combined Imports​	Trade Balance​
2018–2019​	PTI​	$30.374 billion	$62.835 billion	-$32.461 billion
2019–2020​	PTI​	$27.843 billion	$52.172 billion	-$24.329 billion
2020–2021​	PTI​	$31.437 billion	$62.556 billion	-$31.119 billion
2021–2022​	PTI / PDM​	$39.512 billion	$84.453 billion	-$44.941 billion
Total​	-​	$129.166 billion​	$262.016 billion​	$132.85 billion​

I don't see any miracles happening, do you?

Have you also considered Cartoon-e-Azam Imran Khan importing in huge volumes (at Pakistan's expense) just to re-export it to Afghanistan (in lower price) from September 2021?

Which Current Account Deficit exactly are you talking about when we had Current Account Surplus for the financial year 2024-2025?

Did you forget to account for the $12.5 billion of frozen debt that became payable after it's 15-year grace period ended?

Bills from a bygone era: 15 years after 9/11, Paris Club debt finally comes due

My bad, I meant to say BoP in my original post.

And your question re: 2025 was answered above by others -- i.e., we have a poorer house with depressed spending and imports.

In other words, your daku-babu regime didn't solve the economic problem, but rather, the positive CAD of this year was a result of broader economic mismanagement.

Also, I am not a fan of IK/PTI cult. It's no different in nature than the PPP and BB cult. However, your daku-babu horde isn't the solution we need -- nor want -- either.

 

[Sainthood 2.0]

I wonder what's causing this sharp decline in exports
werent energy and oil prices going down afaik? I think it has to do with import restrictions needed for exports
tricky situation

 

[Sainthood 2.0]

Also, our REER value is @ 104 something rn, or that's what I heard
Our currency is overvalued, and if they remove import restrictions, we'll have another CAD crisis.
But you need some sorta imports for your exports to increase.

We need $ somehow

 

[PK781]

economy is in the gutter and the duffers in charge have no idea how to fix it

they don't want it fixed bcaz it will affect all their own corruptions taking place daily........poor awaam continue to suffer.......

Sadly, only a world war type scenario will save the people from these duffers running the country