According to the Pakistan Bureau of Statistics, merchandise exports of the country have declined to $10.322 billion during the first six months of the current fiscal year from $12.058 billion during the same period last year. Percentagewise, the decline is recorded at 14.40 percent. The bureau finds a decline of 16.80 percent alone in December 2015 as compared to the previous fiscal year mainly due to bleak performance of the textile sector. Other sectors such as petroleum, jewellery, leather, engineering, furniture and cement also marked low performance and the government is coming up with a three-year Strategic Trade Policy Framework plan to improve the situation. The government is looking for the reasons as to why exports of textile products have declined despite the provision of cheaper electricity and gas. The government will focus on actual consumption of cotton yarn by the textile mills in the country. On another note, trade deficit have also decreased by 1.35 percent to $11.924 billion from $12.087 billion in July-December 2014-15 as imports fell by 7.86 percent to $22.246 billion during July-December 2015-16 from $24.145 billion in the same period last year. However, trade deficit surged by 21.96 percent due to slightly increase in import bill during December 2015. Experts label the decline in import bill due to lower oil prices in the international market.
Textile is the main earning sector in the country and drop in the exports is a serious issue which is undermining the overall performance of the economy. The government has already offered cheaper electricity and gas to the textile units to lower the cost of production, but factors behind drop in textile exports have to be investigated and identified. The overall exports of the country stood at $23.9 billion during 2014-15, even lower than Bangladesh which has half of the volume of the economy as compared to Pakistan. At least 54 percent of the total shipments from Pakistan comprise textile and garments, but the country has only 4 percent share in the global textile exports. Bangladesh stands third in garments export in the world which is a point to ponder for the country’s policymakers, financial managers and trade experts.
There is a need to explore causes and effects of the declining exports. Shortage of energy, outdated technology, lack of quality compliance, weakening commodity prices in the international market and slowing down of Chinese economic growth are cited as some of the reasons contributing to the lower exports of Pakistani products. But core issue of declining exports is at home and not somewhere else in the world. The commercial attachés of the country are drawing hefty salaries and perks, but no one is there to check their performance. The government is in the habit of changing laws applicable in the business, trade and industrial sectors which are harmful for the economy. Until the government shifts its focus on the economy rather than politics, the cherished goal of economic development will remain a distant dream.
