LAHORE - The 1MFY13 trade deficit of the country clocked in at $1.6 billion, recording a rise of 4 per cent against $1.5 billion in the same period last year. This marked a sluggish start to the new fiscal year with Pakistan’s exports and imports both sliding further into the red zone. In July-12 Pakistan’s imports remained higher than exports amounting to $3.7 billion while exports stood at $2.1 billion.

Exports contracted by 4.6 per cent YoY in July mounting to $2.1 billion which is $0.1 billion less than exports made in July last year. Some of the main commodities exported during July-12 were cotton cloth (Rs 19 billion), Knitwear (Rs 18.6 billion) and Jewellery (Rs 18.4 billion). However, the commerce ministry expects this figure to improve with the implementation of next three years trade policy framework (2012-15) which promises measures to boost exports.

Imports reached $3.7 billion, a decline of 0.73 per cent which was $0.27 billion less than the import bill in July FY12. Some of the main commodities imported during July-12 were petroleum products (Rs 93.3 billion), petroleum crude (Rs 34.3 billion) and Palm oil (Rs 19.9 billion).

Remittances sent home by overseas Pakistanis continue to grow and projected a rise of 9.89 per cent to $1.2 billion in July FY13 compared with $1.1 billion received in the same month of FY12. Remittances received from some of the countries were; Saudi Arabia $3.5 billion, UAE $2.4 billion, USA $2.2 billion, UK $1.5 billion, Gulf Cooperation Council (GCC) countries $1.4 billion and European Union countries $0.3 billion. This continuous growth in worker remittances attributed to the Pakistan Remittance Initiative taken to facilitate both overseas Pakistanis and their families back home.

Pakistan’s total liquid foreign reserves stood at $15.3 billion on August 10, 2012, as against total reserves of $15.5 billion a week before. Out of these $15.3 billion, foreign reserves held by SBP were $10.8 billion and net foreign reserves held by banks (other than SBP) $4.5 billion.

FDI slipped down by 50.3 per cent to $0.42 billion during July 2012 from $0.85 billion in the same period last year.

However, foreign inflows in the equity market (portfolio investment) saw an inflow of $0.28 billion as against the outflow of $0.29 billion during the corresponding month of FY12. This decline in FDI was on account of international economic sluggishness, local energy shortages, political instability and poor law and order situation in Pakistan.