Pakistan's exports stood at ارب 12.34 billion and imports at 32 32.93 billion.

ISLAMABAD: Pakistan's trade deficit in the first five months of the current financial year reached ارب 20.59 billion with an increase of 111.74%. During July-November, Pakistan's exports stood at ارب 12.34 billion and imports at 32 32.93 billion. According to the data released by the Pakistan Bureau of Statistics, the month of November has increased by 17% as compared to October and 33% as compared to November 2020 last year. Exports in November stood at ارب 2.884 billion, compared to 46 2.46 billion in October and 17 2.171 billion in November last year. On the other hand, Pakistan's imports increased by 23.15% in November as compared to October and 82.83% as compared to November last year. In November this year, Pakistan's imports were 7 billion 847 million dollars, while in October it was 6 billion 372 million dollars and in November last year it was 4 billion 292 million dollars. The trade deficit stood at 27% in November. Panic gives way to carnage at stock market A stockbroker looks at share prices on an index board during a trading session at the Pakistan Stock Exchange (PSX) in Karachi on Thursday. — AFP KARACHI: Share prices sank like a stone on Thursday as the latest economic data showed a worsening trade deficit with an indication that interest rates may go up sharply in the immediate term. The KSE-100 index lost 2,134.99 points or 4.71 per cent to close at 43,234.15 points. The benchmark lost the highest number of points in a day since March 2020 when the Covid-related restrictions kicked in. The single-day decline in share prices constituted the fourth largest fall ever in terms of index points, according to Ismail Iqbal Securities Ltd. The trade deficit for November amounted to $5.1 billion, the highest-ever in the country’s history. In addition, investors expected an interest rate increase in the next monetary policy as the cut-off yields of treasury bills recorded a major jump in the latest auction. The expectation of a higher inflation number next month on the back of the low-base effect, coupled with currency depreciation, further eroded investors’ sentiments, according to Arif Habib Ltd. Market participation increased by 60.4pc to 386.8 million shares as investors rushed to dump their holdings. The value of traded shares jumped 52.4pc to $79.7m. KSE-100 index sheds over 2,134 points, highest in a single day since March 2020 Speaking to Dawn, Next Capital CEO Najam Ali said volatility in the stock market would continue until the return of stability to the foreign exchange market. “The [stock] market can predict an interest rate hike and build it into earnings. The real problem is the perception that the government is unable to control inflation and curb imports. That’s creating nervousness,” he added. But Mohammed Sohail of Topline Securities asserted that nobody anticipated that the yields on treasury bills would jump close to 12pc so quickly. “[The latest auction] sent a signal that interest rates would not just increase, but increase rather sharply. That’s why investors sold their positions aggressively, which created a panic-like situation,” he told Dawn, noting that the stock market will remain under pressure and “take a long time” to recover from the sudden jolt. The only stock that contributed positively to the KSE-100 index was First Habib Modaraba, although its weight in the benchmark index is just 0.09pc. Its share price increased by Rs0.07 or 0.77pc to Rs9.22. Six index constituents that registered no change in their share prices were Ibrahim Fibres Limited, EFU General Insurance Limited, Feroze1888 Mills Limited, Murree Brewery Company Limited, Pakistan Services Limited and Shakarganj Limited. The rest of 93 companies that contribute to the performance of the KSE-100 index posted share price declines ranging from 0.2pc to 9.98pc on a day-on-day basis. Sectors taking away the highest number of points from the benchmark index included commercial banking (360.42 points), cement (314.2 points), oil and gas exploration (240.12 points), technology and communication (211.75 points) and fertiliser (203.7 points). Shares that contributed most negatively to the benchmark included Lucky Cement Limited, which took away 149.77 points from the KSE-100 index, followed by Systems Limited (118.9 points), Hub Power Company Limited (101.45 points), Habib Bank Limited (91.39 points) and Pakistan Petroleum Limited (76.94 points). Stocks recording the biggest declines in percentage terms included Yousaf Weaving Limited, which went down 9.98pc, followed by Byco Petroleum Pakistan Limited (9.3pc), Pakistan International Bulk Terminal Limited (8.11pc), International Industries Limited (7.5pc) and Attock Refinery Limited (7.5pc). Stocks that contributed significantly to the traded volume included WorldCall Telecom Limited (33.02m shares), Dolmen City REIT (29.58m shares), Byco Petroleum Limited (22.82m shares), Unity Foods Limited (17.73m shares) and G3 Technologies Limited (17.58m shares). Foreign investors remained net buyers as they purchased shares worth $0.74m on a net basis. Published in, December 3rd, 2021 Trade deficit hits all-time high in November ISLAMABAD: The month of November of the current fiscal year (FY22) saw a steep rise of 162.4 per cent in trade deficit which was driven largely by more than triple increase in imports compared to exports from the country. The reversing trend in trade deficit was witnessed for the fifth consecutive month as merchandise trade deficit reached $5.107 billion in November against $1.946bn over the corresponding month last year, according to provisional data released on Wed­nesday. This is the highest trade deficit recorded in a single month in terms of value. The current year started with a rising import bill which poses a serious threat putting pressure on the external side. The import bill in November reached an all-time high of $8.01bn from $4.12bn over the corresponding month last year, indicating an increase of 94.41pc. Adviser to the Prime Minister on Commerce Razak Dawood said in a tweet that data on imports was being analysed and would be shared shortly. He only shared data on export proceeds in November to portray a positive image of his government. The highest-ever increase in imports also helped the Federal Board of Revenue collect maximum revenue at import stage — sales tax, withholding tax and customs duty. However, the government’s battle against the bloated trade deficit is reversing and may cause pressure on the external side because of all-time high imports. The first five months of the current fiscal year saw a rise of more than 117.25pc in trade deficit. The merchandise trade deficit rose to $20.746bn in July-November 2021 from $9.549bn over the corresponding months last year. The Ministry of Finance believes that an increase in remittances, growth in export proceeds and Roshan Digital Accounts will help mitigate the pressure to a large extent. Trade deficit had reached an all-time high of $37.7bn in FY18. However, government’s measures led to a drop in it to $31.8bn in FY19 and $23.183bn in FY20. The trend reversed and trade deficit stood at $30.796bn in FY21. The trade gap has been widening since December last year, mainly led by exponential growth in imports and comparatively slow growth in exports. The import bill in July-November 2021 rose by 71.59pc to $33.111bn against $19.296bn over the corresponding months last year. In November 2021, the import bill edged up to $8.01bn from $4.12bn over the same month last year, reflecting an increase of 94.41pc. One of the major initiatives of the government to encourage imports of raw materials also pushed up the import bill. Oil prices have also increased substantially, which pushed up the import bill because of high demand for energy in the domestic market. A surge was noted in imports of vehicles, machinery as well as vaccines, pushing the import bill. In FY21, the import bill surged by 25.8pc to $56.091bn from $44.574bn the previous year. Exports posted a growth year-on-year of 27pc to $12.365bn in July-November 2021 against $9.747bn over the corresponding months last year. In November 2021, exports saw a growth of 33pc to $2.903bn against $2.174bn over the same month last year. Razak Dawood termed the growth in export proceeds in November a historic one, saying the export target for five months was $12.2bn. The monthly target for November was $2.6bn. Export proceeds went up by 18.2pc to $25.294bn in FY21 from $21.394bn over the last year. Published in, December 2nd, 2021 Trade deficit compelled govt to approach IMF: PM Imran Prime Minister Imran Khan speaks at the launching ceremony of Sohni Dharti Remittance Programmed. — APP ISLAMABAD: Prime Minister Imran Khan on Thursday said that the country’s trade deficit was the basic compulsion for the government to go to the International Monetary Fund (IMF). “Although our exports are increasing, they are still less than our imports. This causes pressure on our rupee, devaluation of our currency and inflation,” the prime minister said while addressing the launching ceremony of Sohni Dharti Remittance Programmed (SDRP), aimed at encouraging the use of formal channels for remittances. Though Pakistan would be making highest exports this year, other matching economies till the 1960s like Singapore (now around $200 billion) and Malaysia (around $300bn) were far ahead of the country in terms of annual exports, he noted. The prime minister said Pakistan had so far gone to the IMF to seek financial support for 20 times. Programmed launched to encourage use of formal channels for remittances Mr Khan said with Pakistan’s economy growing and imports increasing, there was pressure on the current account. “When pressure comes on the current account, it also puts pressure on the rupee and we have to approach the IMF,” he added. Mr Khan termed nine million overseas Pakistanis the country’s asset and urged his economic team to focus on incentivizing and facilitating them for sending remittances and investing in the country through banking channels for a win-win situation. He said the overseas Pakistanis should be treated as VIPs, because incentivizing and facilitating them would benefit the country. The Sohni Dharti Remittance Programmed is a point-based loyalty programmed under which remitters and their beneficiaries will accumulate reward points by sending remittances through normal channels (State Bank-regulated entities) and will redeem those points at participating public sector entities (PSEs) by availing their services free of cost. A mobile app, in English and Urdu, for iOS (Apple) and Android (Google) is available for remitters to download for registration and later on for point redemption at the PSEs. A remitter can add one beneficiary relative and can transfer reward points to him/her for utilization. A centralized back-end system is developed and run by 1-LINK. The prime minister said the government would launch another programme under which the overseas Pakistanis would be able to purchase houses and invest in real estate in their homeland through Roshan Digital Accounts (RDAs) in a safe and transparent manner. He said the banks would check and verify legal details of housing society so that the overseas Pakistanis could be protected from any fraud. The prime minister directed the planning division to offer tax incentives to the overseas Pakistanis on their investment in real estate. A per the criteria under Sohni Dharti Remittance Programmed, Green category remitter will be awarded one per cent of up to $10,000 annual remittance, 1.25pc for Gold category sending from $10,001 to $30,000 and 1.5pc for Platinum category sending annual remittance of over $30,000. The Public Sector Entities would offer special services for the entitled remitters, including on intentional air tickets of PIA, payment for extra luggage, mobile phone duty payment, and purchase of vehicles, duty on imported vehicles, renewal of CNIC/NICOP, insurance premium, OPF school’s fee and purchases from Utility Store. Further, the option of cash redemption is also being worked out. Prime Minister Khan said Pakistan, which was ahead of countries like Hong Kong, Singapore and Malaysia in exports in 1960s, was now lagging behind due to past neglect and facing the issues of trade and current account deficits. However, he noted with satisfaction that with growth in large scale manufacturing sector during the Covid-19 pandemic remaining on positive trajectory, enhanced remittances from overseas Pakistanis had helped bridge the gap in current account. He said with efforts afoot to enhance foreign direct investment as well, the remittances by overseas Pakistan had been a big support in the difficult time. Governor of State Bank Reza Baqir said after the success of RDAs, the launching of SDRP application by the central bank would help the common or less educated overseas Pakistanis to send their remittances by registering on the SDRP application, which required minimum information, including the details of their identity cards and passports. He said the State Bank under the vision of Prime Minister Khan had also launched a loan scheme for buying 5 and 10 Marla Houses. While applications seeking loans of Rs236 billion had been received so far, Rs90bn loan had been approved and Rs25bn disbursed, he added. PM meets GB CM Later, the prime minister met Chief Minister of Gilgit Baltistan Khalid Khurshid and discussed matters relating to ongoing development projects in the region. The prime minister was informed that work was at full pace to provide facilities of international standard at the tourist points in Gilgit Baltistan. The meeting also discussed the issues pertaining to displacement of people due to construction of Diamer- Bhasha dam and the power policy. Wapda Chairman retired Lt-Gen Muzammil Hussain also called on the prime minister and apprised him about the progress of wok on major dams. Meanwhile, terming the talent of Pakistani youth unparalleled, Prime Minister Khan said the international companies were welcome to establish their ventures in the country. He expressed these views in a meeting with Kaan Terzioglu, Group CEO of Veon, a multinational telecommunication services company, the PM Office said. The prime minister said the youth of Pakistan could greatly benefit from leading international IT and telecom companies. He emphasised technology transfer and the training of youth. Published in, November 26th, 2021 Trade deficit with region widens in 1QFY22 Pakistan’s exports to nine regional countries posted a growth of 31.56 per cent while imports grew by nearly 43pc in the first quarter of current fiscal year (1QFY22) from a year ago. — Reuters/File ISLAMABAD: Pakistan’s exports to nine regional countries posted a growth of 31.56 per cent while imports grew by nearly 43pc in the first quarter of current fiscal year (1QFY22) from a year ago, latest data released by the State Bank of Pakistan showed. The country’s exports to Afghanistan, China, Bangladesh, Sri Lanka, India, Iran, Nepal, Bhutan and the Maldives account for a small amount of $946.218 million — just 13.5pc of Pakistan’s total global exports of $6.997 billion in 1QFY22. China tops the list of countries in terms of Pakistan’s exports to its neighbors’, leaving other populous countries India and Bangladesh behind. Pakistan carried out its border trade with the farther neighbors including Nepal, Sri Lanka, Bhutan, Bangladesh and Maldives via sea only. On the other hand, imports from these countries edged up to $4.128bn in July-September this year against $2.894bn over the corresponding period last year, an increase of 42.6pc. As a result of huge imports, Pakistan’s trade deficit with the region expanded during the period under review. Pakistan’s exports to China posted positive growth in July-Sept FY22. The bulk of the regional exports share, which accounts for 59pc, is with China while the remaining is for eight countries. Pakistan’s exports to China posted a growth of 69.7pc to $559.158 million in the first three months of this year from $329.421m in FY21. The increase in export proceeds was noted in the post-Covid period, especially the exports of rice. Imports up 43pc during the period Contrary to this, imports from China grew 43.6pc to $4.012bn during the period under review against $2.793bn over the last year. The bulk of 97.1pc imports is coming from China alone while remaining imports are from other eight countries. Pakistan’s exports to Afghanistan posted a negative growth of 39.17pc to $127.647m in FY22 from $209.868m in the same period in FY21. The decline in exports to Afghanistan is mainly due to uncertainty in the post-Taliban takeover of Kabul and subsequent issues in banking channels. Till a few years ago, Afghanistan was the second major export destination for Pakistan after the United States. Imports from Afghanistan posted growth of 88.49pc to $33.589m against $17.820m over the last year mainly driven by higher arrivals of essential kitchen items including tomatoes, potatoes and onions as well as fresh and dried fruits. In the post-Taliban period, government has facilitated imports at Torkham as well as Chapman border stations especially of essential food items including fruits and vegetables. The country’s exports to India plunged 90.4pc to $0.099m this year from $1.035m in FY21. The imports from India dipped 14.9pc to $42.502m against $49.947m over the last year. The government has suspended trade relations with New Delhi. Since the arrival of Covid-19 pandemic, the government has only allowed import of pharmaceutical products from India. Pakistan’s exports to Iran at the official channel were not recorded in the first three months of the current fiscal year. Most of the trade with Tehran is carried out through informal channels via the border areas of Balochistan. No imports were made from Tehran during the period under review. Exports to Bangladesh increased 37.57pc to $175.389m in the first three months of FY22 from $127.487m. Imports from Dhaka posted growth of 43.96pc to $17.446m this year against $12.118m over the last year. Published in, November 14th, 2021 Current account deficit surges to 4.7pc of GDP In terms of dollars, the current account deficit increased by $1.663bn in October, while the deficit for the first four months (July-October) of the current financial year rose to $5.084bn. — Reuters/File KARACHI: The current account deficit has widened by $1.6 billion in October. The data issued by the State Bank of Pakistan (SBP) on Friday showed the current account deficit was higher than September while it continued to increase its size in terms of GDP from 4.1 per cent to 4.7pc. The deficit has already gone much beyond the target which was in the range of 2-3pc of GDP for the entire current financial year. The increasing deficit has a vast negative impact on foreign exchange reserves and exchange rate regime which has resulted in the depreciation of rupee by 13.4pc during the current financial year. The gap has already crossed the targeted level In terms of dollars, the current account deficit increased by $1.663bn in October, while the deficit for the first four months (July-October) of the current financial year rose to $5.084bn. The real reason behind the current account deficit is the growing size of imports. According to the SBP data, the imports in July-October went up by 66.3pc to $23.484bn against $14.118bn recorded in the same period of FY21. The deficit on balance in goods and services during this period was $14.845bn compared to $7.546bn of same months of the previous financial year. The imports of goods in October went higher by $6bn reflecting the failure of policy measures taken by the central bank and the government. The first quarter result had already reflected the trend for trade and current account deficit as it rose to 4.1pc of GDP. The increasing current account deficit resulted in the pressure on exchange rate as the local currency lost 13.4pc against the US dollar during FY22. The government had succeeded in reducing the current account deficit from $20bn in FY18 to $1.9bn in FY21 but the growing size of the recent deficit could be in the range of about $10bn provided the current situation persists for the rest of the financial year. The current account deficit in September was $1.113bn compared to $1.473bn in August. The decline in September was encouraging for the government but the deficit in October further went up by $1.66bn. The foreign exchange reserves of the SBP declined since October 1 by over $2.2bn to $16.9bn reflecting the poor reserves situation. The county has yet not received the promised $3bn from Saudi Arabia, while the International Monetary Fund has yet to finalise the negotiations for the resumption of loans. The situation is not in favor of exchange rate and the balance of payments. Published in, November 20th, 2021 Mounting imports push trade deficit up 103pc in 4MFY22 ISLAMABAD: The first four months of the current fiscal year (4MFY22) posted a rise of more than 103 per cent in trade deficit driven largely by an almost double increase in the country’s imports compared to exports, the Ministry of Commerce (MoC) said on Monday. The merchandise trade deficit reached $15.525 billion in July-October 2021 from $7.617bn over the corresponding months of last year. The current year started with a rising import bill which poses a serious threat of causing pressure on the external side. The Ministry of Finance believes that increase in remittances, growth in export proceeds and Roshan Digital Accounts will help mitigate the pressure to a large extent. The rising trend in the trade deficit was consecutively noted in the fourth month as merchandise trade deficit reached $3.775bn in October from $1.803bn over the corresponding month of last year. Govt expects increase in remittances, growth in export proceeds Initial estimates show rising import bill might push the current account to $10bn in the FY22. Trade deficit had reached an all-time high of $37.7bn in FY18. However, government measures led to a drop to $31.8bn in FY19 and $23.183bn in FY20. The trend reversed and trade deficit was recorded at $30.796bn in FY21. The trade gap has been widening since December last year, mainly led by exponential growth in imports and comparatively slow growth in exports. Exponential growth in imports was blamed for the reverse trend seen in a fourth consecutive month. The import bill in July-October 2021 rose by 64.5pc to $24.994bn against $15.193bn over the corresponding months of last year. In October 2021, the import bill edged up to $6.247bn from $3.907bn over the last year, reflecting an increase of 60pc. According to the MoC, about 40pc of the increase in imports was investment-driven – capital goods, raw material and intermediates – which indicated expansion and enhanced activity in industry. The remaining 60pc of imports comprise petroleum, coal & gas at 34pc, vaccines 11pc, food 8pc, consumer goods 2pc and all others 5pc. Most of this increase is inelastic in nature, the ministry further claimed. In absolute terms, the net increase in total imports over this period is $9.801 billion. Of this, consumer goods are $239m, food $823m, capital goods $1.620bn, raw material and intermediates $2.209bn, petroleum, coal & gas $3.364bn, vaccines $1.068bn and all others $478m. One of the major initiatives of the government to encourage imports of raw materials also pushed up the import bill. Oil prices have also increased substantially, which pushed up the import bill because of high demand for energy in the domestic market. In the outgoing fiscal year (FY21), the import bill surged by 25.8pc to $56.091bn from $44.574bn the previous year. Exports posted a growth year-on-year of 25pc to $9.468bn in July-October 2021 against $7.576bn over the corresponding months of last year. In October 2021, exports posted a growth of 17.5pc to $2.471bn against $2.104bn over the last year. “This is the highest ever export in any October in our history,” Adviser on Commerce Razak Dawood said. Published in, November 2nd, 2021 New vehicles import hits all-time high in FY21 KARACHI: A variety of vehicles parked outside a showroom on Shahra-e-Quaideen.—Fahim Siddiqi / White Start KARACHI: Pakistan has witnessed record foreign exchange spending on highest-ever arrival of new automobiles in 2020-21 on strong demand followed by revival of used vehicles imports. The country imported record 10,513 units of new cars, jeeps, vans, pickups, two-wheelers and buses in FY21 compared to 1,680 units in FY20, 3,716 units in FY19 and 7,424 units in FY18. Besides, for the first time, 390 new electric vehicles (EVs) and 19 used EVs were also imported in FY21. Entry of new players from Korea and China in the local assembly of new models coupled with low interest rates have injected new life in the auto sector while used imported vehicles and locally assembled vehicles by old players also enjoy robust demand. In a first, 390 new and 19 used electric vehicles also imported In FY21, new cars and jeeps held the highest share with 10,157 units compared to just 893 units in FY20, 2,427 in FY19 and 3,758 units in FY18. In overall automobile imports of around $2 billion, the import bill of completely and semi-knocked down (CKD/SKD) kits for cars, bikes and heavy vehicles stood at record $1.6bn in FY21 as compared to $727m in FY20 while $386m was spent for import of used and new vehicles in FY21 as compared to $219m in FY20. In the first two months of the current financial year (2MFY22), import of CKD/SKD kits for local assembly of all vehicles swelled by 214pc to $369m from $117m in the same period last fiscal year, while import of completely built up units (CBU) posted a growth of 118pc to $103m from $47m in 2MFY22. In personal baggage scheme, import of used cars, jeeps, vans and pickups swelled to 29,276 units in FY21 from 16,455 units in FY20 though it was 49,990 units in FY19 and 73,640 units in FY18, said All-Pakistan Motor Dealers Association (APMDA) Chairman H.M. Shahzad. Arrival of used vehicles thrives He said majority of used vehicles had arrived under personal baggage scheme and only 946 motorcycles/scooters had landed under transfer of residence scheme from FY18 to FY21. Asked why import of used cars and jeeps recharged in FY21 after facing a lackluster trend in FY20, Mr Shahzad said importers took time to understand the government decision of curbing used car imports and they resumed imports especially of used cars up to 1,000cc in FY21 as compared to FY20. The government in import policy order 2017 had made it mandatory that all the vehicles (new and used) to be imported under various schemes – the duty shall be paid out of the foreign exchange arranged by Pakistani nationals themselves or local recipient supported by bank encashment certificate showing conversion of foreign remittance to local currency. The remittance for payment of duties and taxes shall originate from the account of a Pakistani national sending the vehicle from abroad and the remittance shall either be received in the account of a Pakistani national sending the vehicle from abroad or in case his account is nonexistent or inoperative in the account of his family, according to the policy. Imports by new and old entrants have shown a marked increase as existing assemblers have also imported new vehicles. Amid revival in used car imports followed by all-time high import of new vehicles in FY21, the share of importing CKD/SKD kits for the local assembly of various vehicles is still above 80pc compared to 20pc share of import of used and new vehicles. Market people cautiously see towards a new Chinese investor whose huge arrival of completely built up (CBU) units has changed the dynamics of official figures of new imported vehicles, followed by thriving commercial imports of high-end electric vehicles after duty cut in budget FY22. Market sources said MG HS vehicles caused a stir in the auto market with delivery of 7,000 units to the buyers from November 2020 till date while around 1,000 units were still parked at the port. New entrants before going towards the assembly line have been allowed by the government under Auto Policy 2016-21 to import 100 units per variant to test the market. But the massive import bill suggests that commercial imports by some specific models have enjoyed an edge. In previous years, the official figures used to dominate by an influx of used cars. Market sources said that electric vehicles like Audi Eton had also arrived after a duty cut that resulted in its price reduction. The sources said many new entrants had not brought imported vehicles in larger numbers as they were allowed 100 units per variant under Auto Policy 2016-21 before the start of local assembly. A leading Korean vehicle assembler said it imported a minimum of five to six units to a maximum of 50 units of different variants ahead of the start of local assembly. Localization of auto parts A new entrant, who asked not to be named, said certainly local assembly was the future of Pakistan but imports of vehicles had so far not proved a big burden on the national kitty as compared to soaring import bill of CKD/SKD kits. He said industry pundits claimed the highest-ever localization of parts in cars from 55pc to 65pc, but in reality no investment had been made towards localization of hi-tech parts, imported engines, transmissions, and electronic control units in the last 30 years. Pakistan has seen obsolete technologies and engines in the last three decades, followed by non-compliant emission standards. Suzuki Mehran existed for over 30 years without any model change followed by a 12-year journey of particular shape and design in other models. These high priced and outdated models also failed to compete in export markets, the new entrant observed. Local industry and their vendors have been relying on imported raw materials, sheet metal, raisin, plastic materials, chemicals etc. Besides, he said, the claim of achieving higher localization did not mean a drop in import bill by the same percentage. Another reason for soaring imports of CKD/SKD kits is low localization levels in many new brands of existing assemblers while vehicles launched by the new entrants has hardly 10pc locally made parts. Published in, October 10th, 2021 Oil import bill widens 97pc in first quarter The country’s oil import bill widened by over 97 per cent to $4.59 billion in the first quarter of current fiscal year. — Reuters/File ISLAMABAD: The country’s oil import bill widened by over 97 per cent to $4.59 billion in the first quarter of current fiscal year (3MFY22) from $2.32bn over the corresponding months of last year owing to rising price in the international market and depreciation of the rupee. The continuing increase in import bill of oil is triggering trade deficit and may cause uneasiness on the external side for the government. The unprecedented increase in prices of petroleum products for domestic users was seen in the first quarter of the current fiscal year. Data released by the Pakistan Bureau of Statistics showed that the import of petroleum products went up by 93.21pc in value and 10.86pc in quantity. Crude oil imports rose by 81.15pc in value and dipped 2.35pc in quantity during the months under review while those of liquefied natural gas increased by 144.02pc in value. Liquefied petroleum gas imports jumped by 53.95pc in value in July-Sept FY22. Food import figures climb up 66.11pc; country set to import 0.6m tones of sugar, 4m tones of wheat The second biggest take of import bill is of food items. The food import bill widened by over 38.03pc to $2.36bn in the first three months of the current fiscal year from $1.71bn over the corresponding months of last year to bridge the gap in food production. The continuing food import bill and the consequent trade deficit is yet another source of worry for the government. Pakistan spent over $8bn on import of edible items in the last financial year. The food import bill will go up further in the next few months because the government has decided to import 0.6m tones of sugar and 4m tones of wheat to build strategic reserves. The total import bill inched up by 66.11pc to $18.74bn in July-Sept FY22 as against $11.28bn over the corresponding months of last year. The import bill of all food items posted a growth in value and quantity in the first three months this year, indicating a shortage in domestic production. Within the food group import, the major contribution came from wheat, sugar, edible oil, spices, tea and pulses. Edible oil import witnessed a substantial increase in quantity, value and per value terms. Import of palm oil grew by 53.91pc in value in July-Sept FY22 to $891.15m from $579.008m over the corresponding months of last year. In quantity, a 14.80pc negative growth was recorded in import of palm oil during the same period. The palm oil import bill increased due to rise in international prices. As a result, the prices of vegetable ghee and cooking oil went up during the last few months for domestic users. The import of soya bean oil dipped by 54.61pc in value and 74.42pc in quantity during 3MFY22 from a year ago. The country imported 338,036 tons of wheat during the first three months of the current fiscal year against 431,593 tons imported last year, showing a decline of 21.68pc. During the first nine months of last year, the government imported 3.612m tones of wheat worth $983.326m as against no imports in the previous year. From April this year to July, no whe­at has been imported. The Econo­mic Coordination Committee of the cabinet has decided to import four million tons of wheat for keeping buffer stock. The import of sugar stood at 157,827 tons in July-Sept FY22 as against 30,134 tons last year, showing an increase of 423pc. Despite imports the sugar price is steadily on the rise, with the commodity fetching a rate as high as Rs115 in the retail market. Import of tea and spices grew by 6.46pc and 40.09pc, respectively, in July-Sept FY22. The growth is mainly due to a drop in import of these products under transit trade and checks on smuggling in border areas. The import bill of pulses, dried fruits, milk and other food products witnessed a massive growth in July. The machinery import bill increased by 35.15pc to $2.84bn in July-Sept FY22 against $2.10bn over the same month last year. Import of power-generating machinery went up by 24.94pc in the months under review mainly due to China-Pakistan Economic Corridor-related projects. Published in, October 17th, 2021 Trade gap widens by over 100pc in 1QFY22 ISLAMABAD: The first quarter of the current fiscal year (1QFY22) posted a rise of more than 100 per cent in trade deficit driven largely by an almost triple increase in the country’s imports compared to exports, the Pakistan Bureau of Statistics (PBS) said on Monday. The merchandise trade deficit reached $11.664 billion in July-September 2021 from $5.814bn over the corresponding months of last year. The trade deficit poses a serious threat of causing pressure on the external side. However, government officials believe that increase in remittances, growth in export proceeds and Roshan Digital Account will help mitigate the pressure to a large extent. The rising trend in the trade deficit was consecutively noted in the third month as merchandise trade deficit reached $4.099bn in September from $2.410bn over the corresponding month of last year. The initial estimates show that the rising import bill might push the current account to $10bn in the FY22. Trade deficit had reached an all-time high of $37.7bn in FY18. However, the government measures led to a drop to $31.8bn in FY19 and $23.183bn in FY20. The trend reversed and trade deficit was recorded at $30.796bn in FY21. The trade gap has been widening since December last year, mainly led by exponential growth in imports and comparatively slow growth in exports. An official of the Ministry of Finance told Dawn that one of the major spending in September was $448 million on import of vaccines. An almost similar amount was spent on the purchase of vaccines in the month of August. According to the federal health ministry data, the total number of doses landed in Pakistan stood at 130m. Of these, a donation of 4.7m came from China while another 25.5 m from COVAX while the remaining over 100m doses were purchased. Exponential growth in imports was blamed for the reverse trend seen in a third consecutive month. The import bill in July-September 2021 rose by 65.08pc to $18.631bn against $11.286bn over the corresponding months of last year. In September 2021, the import bill edged up to $6.479bn from $4.297bn over the last year. On a month-on-month basis, the import bill slightly dipped by 1.49pc. In the outgoing fiscal year (FY21), the import bill surged by 25.8pc to $56.091bn from $44.574bn the previous year. One of the major initiatives of the government to encourage imports of raw materials also pushed up the import bill. Oil prices have also increased substantially, which pushed up import bill because of high demand for energy in the domestic market. As per the State Bank of Pakistan’s statistics, around 628 businesses had acquired concessionary bank loans worth Rs435.7bn for setting up new businesses and/or expanding their existing production lines in Pakistan under the Temporary Economic Refinance Facility. According to the commerce ministry, imports were made on the import of machinery related to textiles, leather, chemicals, etc. The increase in import bill also helped the Federal Board of Revenue (FBR) to post substantial growth in revenue collection on import stage. It is clear from the robust growth of 34pc on a year-on-year basis to Rs81bn in September. The FBR also collects sales tax and withholding tax at import stage, which gained hefty growth mainly because of rising imports. Exports posted a growth year-on-year of 27.32pc to $6.967bn in July-September 2021 against $5.472bn over the corresponding months of last year. In September 2021, the exports posted a growth of 26.13pc to $2.380bn against $1.887bn over the last year. On a month-on-month basis, exports of merchandise increased by 5.92pc. The average monthly exports had stagnated at around Rs2.2bn for the past few years. An announcement by the commerce ministry said that the growth in exports has been due to the hard work of exporters who deserved praise for this accomplishment. Export proceeds went up by 18.2pc to $25.294bn in FY21 from $21.394bn over the last year. The commerce ministry has set an export target of $38.7bn for the current financial year. The export target of commodities for FY22 is $31.2bn and that of services is $7.5bn. Published in, October 5th, 2021.. 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