Pakistan’s exports of goods decreased for the seventh consecutive month in March, falling 14.76% year over year to $2.36 billion, as the country’s export industry shrunk because of concern of large-scale job losses.
According to information issued on Monday by the Pakistan Bureau of Statistics, exports during the first nine months of 2022–23—from July to March—were down 9.87 percent, coming in at $21.04 billion as opposed to $23.35 billion during the same period the previous year.
Internal and external factors fueling concerns about the closure of industrial units, particularly those producing textiles and clothes, are the main causes of the decreased export revenues.
In March, imports decreased 40.25 percent to $3.82 billion from $6.40 billion in the same month last year. In the first nine months, imports fell 25.34pc to $43.94bn this year from $58.85bn over the corresponding period last year.
The trade deficit decreased by 35.5 percent, from $35.50 billion in the equivalent months of FY22 to $22.9 billion in FY23. On a yearly basis, the trade deficit in March decreased by 59.75 percent to $1.46 billion.
With the exception of August, which saw a minor gain due to the backlog from the previous month, exports began to show negative growth in the first month of the current fiscal year, July. A worrying development is the contraction of exports, which will make it difficult to balance the country’s external balance.
The decline in exports, particularly those of textiles and apparel, which account for more than 60% of all exports, indicates that the government will have trouble meeting its export goal for the current fiscal year.
According to Jawed Bilwani, head of the Pakistan Apparel Forum, it is now challenging for exporters to place orders for the import of raw materials and other inputs acquired locally. He claimed that the State Bank of Pakistan had made it difficult to open letters of credit, which had decreased exports.
According to him, the main reason why customers have postponed placing orders is the nation’s political and economic unpredictability. He advised that the government draught explicit directives to convey to overseas customers that their orders will be fulfilled on schedule. We are forced to promise buyers that we would meet their needs, he said. Mr. Bilwani bemoaned the cancellation of four meetings with exporters by Prime Minister Shehbaz Sharif.
He claimed that increasing exports is the only way to boost the nation’s foreign exchange reserves.
He anticipated a 17 percent decline in shipments in April. According to him, Pakistani exporters are no longer competitive on international markets as a result of the government’s March 1 decision to stop subsidies for power and gas for the export sector.
Exporters think that fluctuating exchange rates were a major factor in the decline of exports.