Trade deficit hits all-time high in November

ISLAMABAD: The month of November of the current financial time (FY22) saw a steep rise of162.4 percent in trade deficiency which was driven largely by further than triadic increase in significances compared to exports from the country.

The reversing trend in trade deficiency was witnessed for the fifth successive month as wares trade deficiency reached$5.107 billion in November against$1.946 bn over the corresponding month last time, according to provisional data released on Wed­nesday. This is the loftiest trade deficiency recorded in a single month in terms of value.

The current time started with a rising import bill which poses serious trouble putting pressure on the external side. The import bill in November reached an- time high of$8.01 bn from$4.12 bn over the corresponding month last time, indicating an increase of94.41 pc.

Adviser to the Prime Minister on Commerce Razak Dawood said in a tweet that data on significance was being analyzed and would be participated shortly. He only participated in data on import proceeds in November to portray a positive image of his government.

The highest-ever increase in significance also helped the Federal Board of Profit collect maximum profit at the import stage — deals duty, withholding duty, and customs duty. Still, the government’s battle against the bloated trade deficiency is reversing and may beget pressure on the external side because of all-time high significances.

The first five months of the current financial time saw a rise of further than117.25 pc in trade deficiency. The wares trade deficiency rose to$20.746 bn in July-November 2021 from$9.549 bn over the matching months last time.

The Ministry of Finance believes that an increase in remittances, growth in import proceeds, and Roshan Digital Accounts will help alleviate the pressure to a large extent.

Trade deficiency had reached an- time high of$37.7 bn in FY18. Still, the government’s measures led to a drop in it to$31.8 bn in FY19 and$23.183 bn in FY20. The trend reversed and trade deficiency stood at$30.796 bn in FY21.

The trade gap has been widening since December last time, substantially led by exponential growth in significances and comparatively slow growth in exports. The import bill in July-November 2021 rose by71.59 pc to$33.111 bn against$19.296 bn over the matching months last time. In November 2021, the import bill edged up to$8.01 bn from$4.12 bn over the same month last time, reflecting an increase of94.41 pc.

One of the major enterprises of the government to encourage the significances of raw accouterments also pushed up the import bill. Canvas prices have also increased mainly, which pushed up the import bill because of the high demand for energy in the domestic request.

A swell was noted in significances of vehicles, ministry as well as vaccines, pushing the import bill. In FY21, the import bill surged by25.8 pc to$56.091 bn from$44.574 bn the former time.

Exports posted a growth time-on-time of 27pc to$12.365 bn in July-November 2021 against$9.747 bn over the matching months last time. In November 2021, exports saw a growth of 33pc to$2.903 bn against$2.174 bn over the same month last time.

Razak Dawood nominated the growth in import proceeds in November as a major one, saying the import target for five months was$12.2 bn. The yearly target for November was$2.6 bn.

Import proceeds went up by18.2 pc to$25.294 bn in FY21 from$21.394 bn over the last time.

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