ISLAMABAD: The finance minister Miftah Ismail said on Thursday that Pakistan’s trade deficit for the month of August decreased by 27% due to the government’s decision of curbing imports.
According to Miftah Ismail the data released by Federal Board of Revenue (FBR) shows that imports came down by 13% to $5.7 billion in August compared to last fiscal year.
In a tweet, the finance minister also stated that the trade deficit of Pakistan remained at $3.2 billion in August whereas energy imports after a five percent increase remained at $2 billion whereas non-energy imports were recorded at $3.6 billion decreasing by 21% in comparison with last year’s same period.
Miftah Ismail also said that the exports rose by 13% to $2.5 billion, with imports remaining at $5.7 billion maintaining the trade deficit at $3.2 billion, which was a 27% decrease in the trade deficit.
However, the State Bank of Pakistan (SBP) and the Pakistan Bureau of Statistics (PBS) are yet to post their August data.
Analysts said data indicates that the import compression measures taken by the government have firmly taken hold and are now effectively curtailing imports as per the policy regime of the government.
The government had in May banned imports of all non-essential luxury goods to avert a balance of payments crisis after the central bank reserves had fallen as low as $7.8 billion.
Pakistan’s major imports including fuel, edible oil, and pulses were exempted from the ban.
Imports fell by more than a third in July after a ban on non-essentials goods. July imports fell to $5 billion, down 35% from June’s record monthly high of $7.7 billion.
Last month the government lifted the ban, except for automobiles, cell phones, and home appliances. But such items were heavily taxed. The government imposed a series of regulatory duties on a number of items to slow imports.
Analysts said the trade balance has also benefited from a fall in global oil prices which has eased pressure on the hefty import bill of the country — a net energy importer.
In the last fiscal year, the trade deficit had surged to an all-time high of $48.66 billion, up from $30.96 billion a year ago, a significant 57% jump on the back of higher-than-expected imports.
