ISLAMABAD: The Ministry of Commerce is collecting the data of import and export to analyze the trend of widening of trade deficit during the current fiscal year.
As per data compiled by the Ministry, the country recorded trade deficit of $23.96 billion during the last financial year as compared to $ 22.1 billion during previous financial year 2014-15. It reflected an increase of 8.42 percent.
A source at the Ministry of Commerce told Customs Today that trade deficit was recorded as $19.94 billion, $22.1 billion and $23.96 billion in last three fiscal years — 2013-14, 2014-15 and 2015-16, respectively.
The source said that main contributory factors in the widening of trade deficit included the growth in national imports quantum as imports grew by nearly 6% mainly owing to the several reasons.
“The demand of many imported items is inelastic e.g. petroleum products, food items and machinery. Due to the increase in development activity in the country especially CPEC the import of machinery and equipment has increased. Due to the shortfall in cotton production in the country, larger quantities of raw cotton are being imported from abroad to meet the demand of the textile industry” the source added.
The source said that trade balance had also been affected due to decline in Pakistan’s exports for a number of reasons including the economic slowdown in the global market, global commodity crisis, currency devaluation by competitors as well as Pakistan’s low position in global competitiveness index.
However, the source said that Pakistan was the beneficiary of GSP plus in the Single Market of European Union since last January 2014. This represented an increase of 10.7 percent in exports of Pakistan to France. However, the same export increase was not reflected in US dollar term. The reason was the depreciation of Euro vis-a-vis US dollar in the aftermath of sovereign debt crisis in the Euro zone.
