ISLAMABAD: Trade deficit for the first two months of the current fiscal year has fallen by nearly 38 percent, mainly driven by a decrease in imports.
The trade deficit dipped to $3.973 billion in July-August from $6.37bn over the same period last year, reflecting a decline of 37.62pc, claimed a report in Dawn.
During the last fiscal year, the country’s trade deficit narrowed to $31.82bn, registering a decline of 15.33pc. The decline came on the back of government’s interventions to arrest the rising import bill even though export proceeds posted a mixed trend during the same period.
Imports have remained well above the $3bn mark since October 2016 and have risen consistently over the period peaking at $5.8bn in May 2018. The incumbent government has taken several measures to curtail rising import bill since coming into power in August 2018.
On the other hand, duty-free imports — machinery and raw materials — grew by 6.89pc to $3bn in July-August as against $2.9bn over the corresponding months last year. The growth comes on the back of government’s decision to exempt maximum raw materials from duty in the last budget and facilitate machinery-related imports to promote economic activities in the country.
According to the report, a customs officer is reported as saying that the import bill could have declined further had the government not waived off duty on import of 1,639 raw materials in the last budget.
He claimed that the rise in raw material and machinery imports is likely to accelerate industrial growth in the country. “We are expecting that duty waiver on raw materials and machinery will boost economic activities in the current fiscal year,” the official hoped.
