Govt fails to arrest decline in exports

Country’s total exports decline by 14.40% in Jul-Dec 2015

The country’s total exports declined by 14.40 per cent to $10.322 billion in the first six months of the current fiscal year (July-Dec) 2015-16 from $12.058 billion during the same period last year.

“The main reasons behind the falling exports are international recession as exports of most of the countries in the world have shrunk in the last six months,” said Trade Development Authority of Pakistan (TDAP)’s Mohammad Farooq. “Despite the slow exports, we and the government are trying our best to capture the big markets in Europe and America, but it would take time,” he added.

He said that the TDAP was trying to boost exports through exhibitions like Home Textile, the biggest textile exhibition of Europe which is going on in Frankfurt. He further said that with the help of the government, around 120 exhibitors would also participate in single country exhibition in Sri Lanka this January and that they hoped that the orders would start coming in soon.

The government has also finalised the trade policy with many export incentives to the textile sectors and others to boost exports further in the coming months. “Total exports will touch $23-$24 billion as a result of these policies,” he maintained.

The analysts of different brokerage house said that the Ministry of Trade had to announce the trade policy and the business community was looking for incentives. The government had delayed the launch of a trade policy by almost six months.

On year-on-year basis, the country’s exports declined by over 16.80 per cent to reach $1.788 billion in December 2015 compared with $2.149 billion in December 2014, data released by Pakistan Bureau of Statistics on Tuesday revealed. However, on month on month basis, the exports declined by 7.58 per cent in December 2015 compared with $1.662 billion in November 2015.

Business analysts said that the government released refunds of exporters in November and December, which gave a little boost to export numbers in December, but that gas and electricity shortages in Sindh and Punjab remained the main hurdles in increasing the country’s exports.

The TDAP official also blamed the energy shortage for decline in exports, especially in Punjab. But the most important issue, according to an exporter, was indifference of the government towards the problems faced by the business community in Punjab and Sindh.

Recently Prime Minister Nawaz Sharif inked some trade agreements with the Sri Lankan government to further enhance the export of Pakistani products to Sri Lanka. The businessman added that Sri Lanka is considered a gateway to Indian markets especially for Pakistani garments.

Analysts of a number of brokerage houses believed that Pakistan’s economy had improved in recent years and pointed out that GDP growth of above 4.5 per cent had been forecast for 2016 and 4.8 per cent for 2017.

Meanwhile, the country’s imports fell by 7.86 per cent to $22.246 billion during July-Dec this fiscal year from $24.145 billion during the same period last year.

On a month-on-month basis, imports declined by 0.59 per cent in December 2015. The imports were recorded at $3.843 billion in December 2015, which stood at $3.866 billion in November 2015. On year on year basis, the imports of the country increased 0.23 per cent to $3.843 billion in December 2015 compared to $3.834 billion in December 2014.

The trade deficit in July-Dec 2015-16 declined by 1.35 per cent to $11.924 billion from $12.087 billion during the same period last year. In December 2015, trade deficit increased by 21.96 per cent on year on year basis due to the increase in imports.