ISLAMABAD - Pakistan’s trade deficit declined by 35.51 percent to $22.9 billion in nine months of the current fiscal year mainly due to the massive reduction in imports. The country’s trade imbalance, gap between exports and imports, was recorded at $22.9 billion in nine months (July to March) period of the year 2022-23 as compared to $35.5 billion in the same period last year, according to the latest data of Pakistan Bureau of Statistics (PBS). Exports and imports both have reduced in the period under review. However, imports have fallen more than the exports, which have reduced the trade deficit. The federal government and State Bank of Pakistan had imposed conditions on the imports to improve the balance of payment situation. Pakistan’s exports have declined by 9.87 percent to $21.04 billion in nine months of the ongoing financial year from $23.35 billion in corresponding period of the last year despite massive currency depreciation.
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The currency has depreciated by more than Rs100 against dollar in last one year. However, the exports have not enhanced. On the other hand, imports have also fallen by 25.34 percent to $43.95 billion in July to March period of the current fiscal year from $58.86 billion in the same period of the previous year. According to the PBS, the country’s trade deficit has shrunk by 59.75 percent to $1.46 billion in the month of March from $3.63 billion in the same period of the last year. Meanwhile, exports have declined 14.76 percent to $2.367 billion in March 2023 from $2.78 billion in March previous year. Similarly, imports have reduced by 40.25 percent to $3.8 billion in March 2023 from $6.4 billion in same month of the last year. On monthly basis, the trade imbalance was recorded at $1.46 billion in March 2023 as compared to $1.8 billion in previous month (February), showing decline of 20.73 percent. The data showed that exports have enhanced by 8.03 percent to $2.367 billion in March this year from $2.191 billion in the preceding month of December. Meanwhile, the imports have reduced by 5.11 percent to $3.8 billion from $4.034 billion in the last month.
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The massive reduction in trade deficit would help in improving the current account deficit. The ministry of finance has already projected that current account deficit would decline in the month of March. For the month of March, it is expected that exports and imports will remain at current level due to slow growth in the major trading partners and contained domestic economic activities. However, remittances will probably further improve due to positive seasonal and Ramazan factor.