JULY - AUG 2020

TRADE CHRONICLE
An overview of Import and Exports of Pakistan
By Muhammad Nawaz Iqbal
Prime Minister Imran Khan has said
Pakistan's economy was on the right
track with significant achievements in the
exports sector and foreign remittances.
"This strong turnaround is a result of a
continuing recovery in exports, which
rose 20 percent compared to June 2020,
and record remittances," he said in a
tweet. Earlier, Pakistan's trade deficit
witnessed significant reduction during
the FY2019-20, declining by 27.12% as
compared to the previous year. The
Country's trade deficit during FY2019-20
stood at $23.180 billion against the deficit
of $31.805 billion during FY2018-19.
During FY2019-20, Country's exports
registered approximately 6.81% decline,
falling from $22.958 billion last year to
$21.394 billion during the current year,
whereas the imports decreased from
$54.763 billion to $44.574 billion,
showing a sharp decline of 18.6%.
The export target was set at US$ 26.2
billion for FY2019-20. However, exports
registered a decline of -6.81% during
FY2019-20 as Pakistan's exporters are
facing declining demand in overseas
markets and difficulties in executing
existing orders due to Covid-19. Exports
during FY2019-20 reached US$ 21.39
billion as compared to US$ 22.96 billion
during FY2018-19.
B e f o re C O V I D - 1 9 , t h e e x p o r t
performance was satisfactory both in
terms of products and destination
diversification. In terms of product
diversification, surgical goods and
medical instruments recorded a growth
of 8.3% during July-March FY2019-20. In
contrast, in terms of destination
diversification, Ministry of Commerce has
started to explore new markets,
especially in Africa.
Export and import trends in past
Historical data of Pakistan export and
import show that exports from the
Country for the year 2015-2016
remained at US$21 billion and imports
were at US$44.76 billion for a similar
period. The rising trend was begun when
Pakistan's fares expanded over 100%
from $7.5 billion of every 1999 to remain
at $18 billion in the money related year
2007–2008.
The currency reserves was exclusively
US dollar acquiring hypothesized
misfortunes after the dollar costs fell
during 2005, driving reportedly the then
Governor SBP Ishrat Hussain to step
down. In the equivalent year, the SBP
gave an official proclamation declaring
expansion of stores in monetary
standards including Euro and Yen,
retaining a proportion of enhancement.
Following the global credit emergency
and spikes in unrefined petroleum
products costs, Pakistan's economy
couldn't withstand the weight. Thus on
11 October 2008, State Bank of Pakistan
detailed that the nation's foreign trade
holds had gone somewhere near $571.9
million to $7749.7 million. The unfamiliar
trade saves had declined more by $10
billion to a degree of $6.59 billion. In June
2013, Pakistan was near the precarious
edge of a default on its money related
duties.
CPEC impacts
Import of Pakistan is demonstrating
increasing pattern at a generally quicker
rate because of the expanded financial
movement as a significant aspect of
China Pakistan Economic Corridor
(CPEC), especially in the Energy area.
The development extends under CPEC
require substantial apparatus that must
be imported. It is additionally seen that
the economy is presently being driven
both by ventures just as utilization,
bringing about generally more elevated
levels of imports. During FY 2018,
Pakistan's fares got and came to
US$24.8 billion, indicating the
development of 12.6 percent over the
earlier year FY 2017.
Pakistan saw the most important exports
of US$25.1 billion in FY 2013–14.
However, after that in the following years,
it had started declining extensively. This
fell began from the money related year
2014–15 when a universal product droop
set in. This was intensified by basic
gracefully side limitations including vitality
deficiencies, high information costs and
an exaggerated swapping scale.
From money related the year 2014 to
2016, sends out declined by 12.4
percent. Fares development pattern over
this period was like the world exchange
development designs. Pakistan's outer
segment kept confronting worry during
2016–17. Yet at the same time,
Pakistan's product exchange trades
developed by 0.1 percent during the
financial year 2016–17. The imports kept
on growing at a lot quicker rate and
developed by a massive level of 18.0
during FY 2017 when contrasted with the
earlier year.
World imports had been stale
somewhere in the range of 2011 and
2014 however enlisted a considerable
drop since mid-2015 as a result of a
feeble item and item costs and powerless
worldwide monetary movement. Imports
then again likewise expanded by 16.2
percent and contacted the most
noteworthy figure of US$56.6 billion.
Subsequently, the import/export
imbalance augmented to US$31.8 billion,
which was the most notable since the
most recent ten years. The decrease in
the import substance of monetary action
set off a move in utilization worldwide
from exchanged towards none
x c h a n g e d p r o d u c t s , i m p o r t
replacement, a lull in the pace of
exchange progression, and offered cash
to protectionist measures.
The central part of Pakistan's fares are
coordinated to the Organisation for
E c o n o m i c C o - o p e r a t i o n a n d
Development (OECD) locale and China.
Authentic information proposes a definite
connection between's Pakistani fares to
imports in OECD and China. According to
the FY 2016 information, the more
significant part of the nation's fares is
delivered to these two goals, for example,
OECD and China. A decrease in Pakistan
by and large exports thus happened in
this setting. Exports of Pakistan to Asia
was added up to $ US 1,649 billion which
was 42 percent of its general fares and
the portion of products of the soil markets
in Pakistan's fare was $ US 1,017 billion.
Pakistan has an enthusiasm for
investigating new export items while
China might need to focus on finding new
markets for its current fare merchandise.
To distinguish the items that can be sent
out by Pakistan, China's imports from the
world have been coordinated with
Pakistan's exports to the world and
Pakistan's exports to China.
TRADE CHRONICLE - July .~ Aug. 2020 - Page # 15