ISLAMABAD - Pakistan’s trade deficit narrowed by 9.66 percent in first seven months of the current fiscal year due to decline in imports and marginal growth in exports.

The country’s trade deficit was recorded at $19.3 billion during July to January period of the 2018-19 as against $21.3 billion of the corresponding period of the previous year, according to the latest data released by Pakistan Bureau of Statistics (PBS) on Monday. The deficit has narrowed due to decline in imports as against the growth in exports of the country.

The country’s exports have increased by 2.24 percent to $13.23 billion during July to January period of the current fiscal year from $12.94 billion of same period of last year. On the other hand, the imports have gone down by 5.17 percent to $32.5 billion in first seven months of the year 2018-19 from $34.3 billion of previous year. Therefore, the trade deficit was recorded at $19.3 billion in the period under review.

Pakistan’s exports had recorded a growth by 3.97 percent and rose to $2.04 billion in the month of January 2019 from $1.97 billion of January 2018. However, the imports have recorded decline of 19.14 percent and reached $4.5 billion in January 2019 from $5.57 billion in the same period of the last year. The trade deficit was recorded at $2.46 billion in January 2019 as against $3.61 billion of January 2018, showing a reduction of 31.73 percent.

Adviser to Prime Minister on Commerce, Textile, Industry and Production and Investment Abdul Razak Dawood said that trade deficit has reduced due to the government’s policies. "We decreased our imports successfully by imposing Regulatory Duties (RD) on the imports of furnace oil and other luxury items of food and automobile,” he said while addressing a press conference along with Secretary Commerce Muhammad Younus Dhaga. He further said that due to the increase in exports and decrease in imports, the county's trade deficit shrank by $2.1 billion in seven months of the year 2018-19.

The advisor said that growth in exports is not sufficient, as it should be higher. He said that impact of rupee depreciation would be visible in next five months. The exports mostly increased in food items, textiles and cements and overall 50 percent cements exports were increased in seven months of current fiscal year, he added. He hoped, "Our imports would be decreased more and country's exports would further increase".

According to the commerce ministry, import of non-essential consumer items has declined as a result of regulatory duties. In January 2019, imports declined by 16% on the products that are subject to Regulatory Duties. Import of power generation equipment has declined by USD 724 million. Import of furnace oil was restricted by the government and imports fell from 3 million MT to 0.4 million MT. In value terms, the decline in furnace oil imports is USD 830 million. Only in December and January, USD 150 million were saved by restricting the use of furnace oil.

On the other hand, in the month of January 2019, exports increased by 4% .Over July-Jan 2018-19, exports have increased by 2.5 percent on a year on year basis. Export growth over 7 months was driven by a number of items. Exports of articles of apparel have increased by USD 306 million while copper and footwear have also registered healthy growth. Cement exports have shown 50% increase in July-Jan 2018-19. Agriculture exports including wheat, rice, citrus, ethanol, dates, and potatoes increased by USD 248 million. Potato exports have shown 116% growth in value terms and 120% increase in quantity terms.