PAKISTAN'S EXTERNAL TRADE
Exports achieve unprecedented level of $9.2 billion this year
By AMANULLAH BASHAR
May 21 - Jun 03, 2001
Despite the fact that the national economy is passing through unfavourable conditions both within and outside the country, the foreign trade from Pakistan is going to accomplish an export target of of $9.2 billion at the end of the current fiscal. Though the target was revised downward from 10 to $9.2 billion by the economic managers, yet it will be unprecedented in this export history of Pakistan.
The export figures never reached to the level of $9 billion during last 50 years. Though the figure of $9 billion is not too high in view of the performance of other Asian economies, yet it gives hope against the hope especially when the economy is swamped by the debt.
Since the imports of the country have always surpassed the amount of foreign exchange earned by the export sector, it is yet to be seen at the end of the year as to how far the economic managers succeed in finding the import substitutes to restrain the gap between exports and imports.
Everybody knew that a major chunk of our foreign exchange earnings goes into purchase of POL products.
According to an estimate, Pakistan has to spend $3.2 billion in terms of oil imports in 2000-2001. Thanks to the downward trend of International oil prices which helped reducing the earlier estimates of $3.5 billion on account of oil imports. It may be recalled that the oil prices in the international market were oscillating between 32-33 dollar a barrel, which gradually declined to the current level of $25 dollar a barrel.
Another major dollar consuming items is edible oil where so far Pakistan is spending around one billion-dollar a year.
The shortage of water during the current year due to drought adversely affected smaller crops especially pulses where imports registered an increase of 65 per cent this year. According to another report, the import bill of pulses showed an increase of 65 per cent in term of rupee during the current fiscal. More than 292,624 tonnes of pulses have been imported during July-April 2000-2001 to overcome more than 30 per cent shortfall of pulses due to drought and late rains in Barani areas during the current sowing season. During the corresponding period of the last year, Pakistan had imported 201,345 tonnes of pulses.
It is heartening to note that the economic managers are taking effective measures for import substitutes to bring the balance of trade to an affordable level. Conversion of power generation and transport sectors from oil to gas on a massive scale may produce some positive results next year. Similarly, policy has already been introduced to encourage home grown oil seeds to cut the import bill on account of edible oil i.e. Palm oil and Soya beans.
Pakistan has set an ambitious export target of $20 billion to be attained by the year 2005. This target indicates 100 per cent increase in exports during the coming four years. In order to achieve that target, the government is focusing on textile, leather, rice, IT and engineering sectors to achieve the export targets.
The textile sector whose exports are estimated at $6 billion in current fiscal year would be more than doubled to $14 billion, leather products are expected to increase from 500 million during the current fiscal to $ one billion in 2005.
Engineering goods exports, only $200 million, is expected to take a quantum jump to $ one billion. Exports of other items would also be increased to $4 billion in 2005 from the present $3.3 billion.
The government expects to raise exports to $30 billion in 2010 wherein textile and its made ups exports are projected at $20 billion, leather $1.5 billion, engineering goods $2.5 billion and others $6 billion.
According to projected estimates, gross domestic product, which at present stood at $65 billion, would also increase to $90 billion in 2005 and $150 billion in the year 2010. The share of industry in GDP during 2001 is 1.7 per cent while it is targeted at 2 per cent in 2005 and 27 per cent in 2010.
Pakistan is also expecting an investment of $8 billion in steel and engineering sectors upto 2010, whereas $15 billion investment in energy sector is being projected during this same period.
According to textile vision 2005, an investment of $6 billion is also expected to come in textile machinery and equipment, processing and canning of fruits, vegetables, livestock and dairy farming and quality seeds.
The government is of the view that an investment of $85 million would be made by 2004 in fruits and vegetables. However, exports of these items would increase to $638 million in 2004 from $173 million during 2001.
Export (Value) of major items from Pakistan
for the month of April 2001
Yarn (Cotton & Blended)
Carpets & Carpeting
Petroleum & Petroleum prod.
Chemical and Pharmaceutical Prod.