Pakistan’s trade deficit with nine neighbouring countries jumps 62% in Q1FY25

Pakistan’s trade deficit with nine neighbouring countries expanded by 62% in the first quarter (July-September) of the fiscal year 2024-25, reaching $2.917 billion, compared to $1.8 billion in the same period last year. 

According to the State Bank of Pakistan (SBP), the trade deficit with these countries stood at $9.506 billion in the previous fiscal year (FY24), a 49% increase from $6.382 billion the year before.

Pakistan’s exports to Afghanistan, Bangladesh, and Sri Lanka increased from July to September FY25, but exports to China and other regional countries declined, further impacting the trade balance. 

Pakistan’s exports to its nine neighbours — Afghanistan, China, Bangladesh, Sri Lanka, India, Iran, Nepal, Bhutan, and the Maldives — increased by 8% to $1.059 billion, up from $983.19 million in the same period last year.

Conversely, imports from these countries rose sharply by 43%, reaching $3.976 billion in the first quarter of FY25, compared to $2.783 billion during the same period last year. 

China remains Pakistan’s largest regional trade partner, with imports from China climbing 42% to $3.890 billion in the first quarter, compared to $2.744 billion last year. 

For FY24, total imports from China stood at $13.506 billion, up nearly 40% from $9.662 billion in the prior fiscal year. 

Exports to China, however, fell by 12% to $559.05 million in Q1 FY25, down from $633.64 million last year.

Pakistan’s imports from India saw a dramatic 771% increase, rising to $57.48 million in Q1 FY25 from just $6.599 million in the same period last year. 

However, exports to India remained minimal at $0.277 million in Q1 FY25, compared to $0.044 million the previous year. 

Diplomatic relations with India have been frozen since August 2019, although the current coalition government, led by Prime Minister Shehbaz Sharif, has hinted at the possibility of resuming trade ties.

Exports to Afghanistan grew by 55% to $200.87 million in the first quarter of FY25, up from $129.22 million in the same period last year, while imports from Afghanistan increased to $6.38 million, compared to $1.05 million last year.

Exports to Bangladesh also rose by 30%, reaching $188.11 million, with imports from Bangladesh increasing by 8% to $16.69 million. Exports to Sri Lanka surged by 49% to $108.62 million.

Trade with Iran is mostly conducted through informal channels, so official data remains limited. 

Exports to Nepal decreased by 29% to $0.565 million, while exports to the Maldives rose 20% to $2.35 million in Q1 FY25. 

There was no recorded trade between Pakistan and Bhutan in the first quarter of the current fiscal year.