Karachi (Web Desk): Pakistan’s trade deficit stood at $2.857 billion in December, shrinking 40.68 per cent year-on-year.
According to the Pakistan Bureau of Statistics’ data, in December 2021, the deficit had clocked in at $4.816bn. The lower figure was mainly on account of a decrease in imports, which amounted to $5.161bn — declining 31.91pc from last December’s $7.58bn.
Imports in the July-December period shrank by 22.63% to $31.38 billion from $40.56 billion in the same period last year. Likewise, exports were also down by 5.79% to $14.25 billion against $15.125 billion in the same period last year.
Imports have plunged primarily because of restrictions imposed since May by the State Bank of Pakistan (SBP) in order to reduce dollar outflows to protect the country’s declining foreign exchange reserves as well as stem the rupee’s freefall.
Import restrictions were in place even on items required as raw material for exports. As a result, exports also declined last month. PBS data showed that exports in December totalled $2.304bn, a decrease of 16.64pc from last year’s $2.764billion.
Eventually, the central bank removed these curbs on Jan 2 this year, as the economic situation began worsening with several companies suspending operations, citing inventory shortages due to import delays.
The country’s foreign reserves have fallen to as low as $5.82 billion, barely enough to cover a month of imports.