Trade gap with Middle East balloons 20pc – Pakistan

ISLAMABAD: Pakistan’s trade deficit with the Middle East widened 19.16 per cent to $3.706 billion in the first quarter of 2024-25 from $3.110bn owing to the rise in petroleum imports from the region.

According to data compiled by the State Bank of Pakistan, the swelling trade gap would be a source of concern for policymakers.

In FY24, the imbalance with the Middle East narrowed by 20.47pc to $13.014bn from $16.365bn over the preceding year, mainly due to lower petroleum imports amid falling consumption of petroleum products thanks to rising prices.

Pakistan’s exports to the Middle East rose 15.44pc to $814.2 million in July-September 2024 from $705.27m over the same months last year. In FY24, the exports to the region grew 35.23pc to $3.155bn compared to $2.33bn in the corresponding period last year.

At the same time, Pakistan’s imports from the Middle East also saw an increase of 18.47pc to $4.521bn in July-September from $3.816bn over the same period last year. In FY24, the imports declined 13.53pc to $16.16bn compared to $18.69bn in the same period the preceding year.

Pakistan has recently signed a free trade agreement with the Gulf Cooperation Council (GCC) states to minimise its trade imbalance with the region.

The demand for Pakistani products surged in the United Arab Emirates (UAE), Saudi Arabia and Qatar during the period under review.

Exports to Saudi Arabia rose 17.66pc to $175.64m in July-September from $149.27m over the last year. In FY24, exports to Saudi Arabia rose 40.98pc to $710.335m from $503.851m in FY23. The imports from the kingdom saw a decline of 6.49pc to $1.065bn against $1.139bn in the same period last year.

In FY24, imports from Saudi Arabia declined by 0.01pc to $4.49bn against $4.50bn in the preceding year.

Exports to UAE increased 19.57pc to $564.41m in July-September from $472.02m over the last year. In FY24, exports to the UAE surged 41.15pc to $2.082bn from $1.475bn in FY23, primarily due to a significant rise in exports to Dubai.

Pakistan’s top export products to the UAE include rice, bovine carcasses, men’s and boys’ cotton ensembles, guavas and mangoes. In July-September, the imports from UAE also witnessed an increase of 31.99pc to $2.009bn from $1.522bn over the last year month.

Published in Dawn, November 12th, 2024