Pakistan's trade deficit widens by 56% YoY in March

Pakistan's trade deficit widened by 56.30% year-on-year (YoY) to $2.171 billion in March 2024, compared to $1.389 billion during the same month of 2023, while increased by 24.56% on a month-on-month (MoM) basis from $1.743 billion in February 2024.

According to the latest data released by the Pakistan Bureau of Statistics (PBS), the country’s merchandise exports in March 2024 rose by 7.99% to $2.55 billion from $2.36 billion in the same month the previous year, marking a slowdown from the double-digit growth seen in the prior three months.

Imports in March 2024 surged by 25.86% to $4.73 billion from $3.75 billion in March 2023, following the government's easing of import restrictions.

The surge in imports is expected to aggravate the trade deficit problem in the last quarter (April-June) of the fiscal year 2023-24.

Trade deficit shrinks 25% in 9MFY24

For the first nine months of the fiscal year 2023-24, the trade deficit narrowed down by 24.94% to $17.030 billion from $22.688 billion in the same period the previous year.

Exports during this period increased by 8% to $22.914 billion, while imports decreased by 8.65% to $39.944 billion compared to the same period last year.

The International Monetary Fund (IMF) projects Pakistan’s exports to grow modestly over the next five years, reaching $39.46 billion by FY28, below the commerce ministry's target of $100 billion.

The interim government facilitated an increase in export earnings through measures like releasing maximum sales tax refunds to exporters, with Rs369 billion refunded in the first nine months of the current fiscal year compared to Rs254 billion in the same period the previous year.