Prime Minister Imran Khan has asked his economic team to check the increase in the import of non-essential goods, including that of vehicles, as his government might face a challenge of an unmanageable current account deficit because of a projected record of $70 billion in imports this fiscal year.
On Tuesday, PM Imran was briefed on the month-wise status of foreign inflows and outflows.
The discussion largely remained focused on the trade figures, which were “not very healthy” in the first month of the fiscal year, at least two participants of the meeting told The Express Tribune.
Both the net foreign direct investment and exports fell short of the government’s estimates for July but the imports were higher than its projections, they added.
Overall, the premier expressed his satisfaction with the increase in the import of plants and machinery, but he asked the finance ministry and the State Bank to remain vigilant because of the surge.
Finance Minister Shaukat Tarin has taken the responsibility to ensure monitoring of all external inflows and outflows related indicators, the sources said.
The finance ministry has estimated about $90 billion outflows in this fiscal year but it also hopes to achieve $88 billion inflows, which include the $1.8 billion highly expensive loans under the Naya Pakistan Certificates scheme.
The $88 billion inflows include $14.2 billion foreign loans, excluding that from the International Monetary Fund (IMF).
There was a discussion as to whether or not the government should increase duties and taxes to check the import of non-essential goods but no final decision had been made, the sources said.
The imposition of the regulatory duties, additional customs duties, and non-tariff barriers were commonly used tools by the central bank and the federal government to discourage imports during the first two years of the PTI government.
The premier inquired as to why the import of vehicles was increasing. His adviser on commerce replied that its share in the overall imports was not very high, the sources added.
In July, the country imported 1,446 sports utility vehicles valuing Rs3 billion.