Trade means buying and selling
of goods and services or exchange of goods and services both at national and
international level.At international level, trade means both export and
import.Export refers to the value of goods and services that one country
produces at home and then sells to other countries.
In the beginning, Pakistan was underdeveloped and agriculture based country,it
could not use available resources in a better way.So, there were no chances for
the growth of export.But now the conditions are different and Pakistan is on the
track of development, and it can use available resources in a better way and
there are more chances for the growth of export.Export is playing very important
role in economic development.Currently, Pakistan’s export is contributed to GDP
about 12.35%.
In 1950-51 Pakistan’s exported goods worth was Rs 1343 million and during that
period exports declined by 43.18%. However, the era of development under Ayub
khan, industries were established and nature of production changed, during this
period export goods worth was 763 million rupees showing downward trend than
before, but shortly regained the momentum and during the period of 1960’s export
was increased by 161.88%. In 1970’s, export increased from 1.99 billion rupees
to 29.28 billion rupees and reached at 138.28 billion rupees in fiscal year
1990-91.The export rose up to 560.94 billion rupees in the period of 2001-02. In
the fiscal year 2003-04 Pakistan’s export was recorded 10 billion dollar showing
an increase of 13.1% from the last fiscal year.
Whereas, in the fiscal year 2011-12 the exported goods worth was 23.6 billion
dollar. In the last year of Pakistan People Party (PPP) which was considered bad
for Pakistan economy, exported goods worth was 24.5 billion dollar.The
government had projected export target for 26.9 billion dollar for 2013-14 which
was missed by 1.8 billion dollar.In the fiscal year 2014-15, the government had
projected export target of 27 billion dollar but actual export proceed stood at
23.9 billion dollars which was 4.9% less than previous fiscal year, missing
target by 3.1 billion dollars.According to latest data of Pakistan Bureau of
statistics, the country had exported goods worth of 5.2 billion dollars during
July- September 2015-2016 as against 6 billion dollar corresponding period last
year showing decline of 13.93%.
If we look back at the trade of Pakistan, we find that our export mostly
increased but unfortunately it is declining consectively from last two and half
years during the development period under Pakistan Muslim League Noon (PML-N)
government.The PML-N government had failed to enhance the country’s export in
the last two and half years. But last year, PMNL-N government had launched its
economic vision,” The vision 2025”, which promises to address all the obstacles,
which will help to pull back the economic growth.One of the important target of
the ten year plan is increasing the export to 150 billion dollars.
Although,Pakistan is trading with large number of countries but Pakistan’s
export is highly concentrated with 10 countries. About above one half of the
export went to these countries namely: United State American (USA), China,
Germany, United Kingdom (UK), European countries (Italy France and Spain),
Bangladesh, UAE and Afghanistan.The maximum export earning comes from USA (15%)
and European countries (20%) are making up one-third of total export.China with
its share of 9% in our total exports has become our regional trading partner.
The share of export to Afghanistan in total export has declined in recent year
from 10% in 2011-12 to 8% during this year. The share of export to European
countries remained relatively unchanged.
On the other side, Pakistan export are highly concentrated with few items namely
cotton and cotton manufactures,leather; rice, chemicals and pharma products and
sports goods. These five categories account for about 64% of the country’s total
exports for the past many years.Furthermore,concentration of export in few items
is a major source of instability in export earnings.
No doubt, Pakistan has made much progress than before but even yet Pakistan has
to walk for a long distance on the way of progress.Our export,like other
developing countries, are facing several hurdles in the way of development.
Currently,Pakistan is facing the problem of decline in export.There are some
reasons because of export is decreasing in Pakistan.The main factor of declining
export is power crises which country’s industrial sector and other sectors are
facing from last few years. The fluctuations in export earnings are generally
attributed to decline in demand and falling international market prices.
Production efficiency of Pakistani industries is low and per unit cost is very
high, hence our goods are not being demanded at local market as well as in
international market because of their high prices. Exchange rate also effect the
quality of export ,the overvaluation of rupee in the recent period is also
caused a decrease in export. Furthermore,Security and business climate
challenges,Political instability which discourage foreigners,Under-developed
agriculture sector are also factors which become the cause of low export.
Government should lay greater emphasis on growth of export because country’s
export is facing greater competition in world market.it should study how china
has been able to achieve very impressive success with their products within a
short time,which is offering its products at highly competitive prices.It should
take precautionary measures to solve power crises problems. Gas and electricity
should be provided to industries so that industries can produce more goods for
export. The quality of products should be improved because foreigners prefer
high quality products.
Agriculture sector should be highly developed because Pakistan is agriculture
based country and by developing agriculture sector it can produce and export
more agriculture products to other countries at lower price.To raise the
external demand of goods, Government should announce incentive package to boost
country’s export so that industries can produce goods at low cost and then
export at low price. Government should ensure foreigners about political
stability and security.
Future prospects of export in Pakistan are that export may increase in the
coming years but still it is considered that export performance in the fiscal
year 2015-16 will be same as in the previous fiscal year.