ISLAMABAD: The commodities’ trade deficit has recorded a decline for the third consecutive month, after it peaked at $5 billion during November 2021, according to data released by the Pakistan Bureau of Statistics (PBS).
The external trade statistics for February shows a promising uptick in the exports of goods while imports witnessed a decline – resulting in an accumulated trade deficit of $3.095 billion, reported WealthPK.
The exports – standing at $2.808 billion – recorded an increase of 7.42% over January 2022. The total goods imported during February were valued at $5.903 billion with a decrease of 2.28% over the previous month. As a result, the trade deficit declined by 9.69% in February, 2022 over January, 2022.
The downtrend in the commodities’ trade deficit over the subsequent months had primarily been due to a sharp decline in imports – which is not sustainable in the case of Pakistan because most key industries rely on imports for their inputs.
However, the decline in February was also supported by a healthy increase in exports.
The trade deficit had reached its peak during November 2021 at $5 billion. The balance started off on a downside trajectory afterwards.
The trade deficit declined by 28% in January 2022 over December 2021 with the decline stemming from a 20% downtrend in imports. The deficit had also witnessed a decline of 1.94% on month-on-month basis in December.
The export of commodities has also clocked an impressive growth year-on-year basis. In February 2021, export figure stood at $2.068 billion while in February 2022 the export of commodities increased to $2.808 billion – increasing by 35%. Although, imports also grew by 28% during this timeframe, exports recorded a relatively higher growth.
The primary imports of the country have been petroleum products, petroleum crude, natural liquified gas and medicinal products. The energy and medical imports have been recording consistent increases. However, as the impacts of the coronavirus pandemic wane off, medical imports – which largely comprised of vaccine and other medicinal products required during the pandemic – are also expected to fall which will, somewhat, ease the pressure on the trade deficit.
On par with expectations, the import of medicinal products recorded a decline of 69% in January, 2022 over December, 2021. The import of natural liquified gas and petroleum products also declined.
In terms of exports, textile and food items remain strong for the country. Cotton cloth and rice Basmati recorded an increase of 14% and 17% respectively, in January, 2022, on a month-on-month basis.
On the other hand, hopes for improvement of the current account deficit may be too soon at the moment as the trade deficit for services continues to rise. The deficit for services was recorded at $405 million during January 2022 – showing an increase of 23% over the previous month.
INP
