ISLAMABAD-Pakistan’s exports and imports have declined massively in April due to the outbreak of coronoavirus throughout the world.

The country’s exports have reduced to $957 million in April 2020 from $2.089 billion in the same month of the previous year showing massive decline of 54.19 percent. According to the latest data of Pakistan Bureau of Statistics (PBS) the imports have also reduced by 34.49 percent to $3.088 billion in April this year from $4.714 billion in corresponding period of previous year. Pakistan’s trade deficit has shrunk to $2.131 billion in April 2020 as against $2.625 billion showing reduction of 18.82 percent.

The PBS data showed that Pakistan’s trade deficit has reduced to $19.497 billion in ten months (July to April) of the current fiscal year (FY20) from $26.233 billion in corresponding period of last year registering reduction of 25.68 percent. Exports have declined by 3.92 percent to $18.408 billion in July-April period of FY20 from $19.16 billion in same period of previous year. Similarly, the imports have fallen by 16.5 percent to $37.905 billion in ten months of the current financial year from $45.393 billion in corresponding period of last year.

The International Monetary Fund (IMF) had recently projected that Pakistan’s exports and imports both would reduce due to the economic shocks from the rapid propagation of the COVID-19 outbreak. Exports are estimated to reduce by $1.86 billion to $23.732 billion during FY20. Similarly, imports are projected to decline by $4.64 billion to $48.291 billion during the present financial year. The reduction in imports would help in reducing the trade deficit of the country. IMF is of the view that fall in oil prices and weaker import demand provide some support to the current account but the COVID-19 shock will have a severe impact on the balance of payments especially declined remittances and exports. It will result in new external financing needs of about $2.0 billion in the last quarter of FY 2020. It is envisaged that these urgent external financing needs will be met through the use of Fund credit, fresh resources committed by multilateral partners.

Data on container traffic at Pakistan’s two major ports shows a sharp decline in export cargo handling since mid-March. This is consistent with the cancellation of export orders or requests to delay the shipments when the lockdown started in Europe. The IMF stated that Pakistan’s economy will be impacted through external and domestic channels: externally, the global downturn, including in Pakistan’s major export markets (China, the EU, and the U.S.), would reduce demand for Pakistan’s exports, especially textiles, and lead to more limited financial flows.

According to the data, the country’s exports have registered decline of 47.24 percent in the month of April 2020. The country has exported goods worth of $957 million in April 2020 as compared to $1.814 billion in preceding month, March. Meanwhile, the imports have tumbled by around 6.88 percent. Imports were recorded at $3.088 billion in April 2020, which was around $3.316 billion in March 2020. The reduction in imports and exports has resulted in increase in trade deficit by 41.88 percent during the month of April this year over March. Pakistan’s trade deficit was recorded at $2.131 billion in the month of April 2019 as compared to $1.502 billion in the previous month, March.