PAKISTAN'S EXTERNAL TRADE
Official sources termed the crossing of exports figure of $9 billion as a big achievement
From SHAMIM AHMED RIZVI,
July 15 - 21, 2002
The financial year 2001-2002 closed with a trade deficit $1.2 billion with exports touching $9.12 billion against imports worth 10.33. The target estimate fixed for the year were $10.1 billion and 11.6 billion respectively.
Viewed in the perspective of the severely upsetting developments in the year 2001-2002, Pakistan's export performance will appear reasonably satisfying. This has special reference not only to the devastating September 11 terrorist attacks on the United States, but also to the situation developing its aftermath. For the subsequent launch of the global coalition's US-led war on international terrorism in Afghanistan, with Pakistan as a front-line State, was followed by the unwarranted declaration of Pakistan as a war zone country by the international shipping and insurance companies. For it led not only to imposition of war risk insurance on our foreign trade, but also to substantial increase in the freight rates, thereby posing no small threat to the country's economy which had already been caught in a state of depression.
Additionally, the global impact of the war against terrorism led to an irrational bias against Pakistan's especially in the USA where the importers of Pakistani goods cancelled their orders while Pakistani shipments reaching the US ports were left without customs clearance for months on end, causing a serious setback to export activity in the country, and export industries faced a long spell of slowdown. Under these circumstances, the prospects of a sustained export growth understandably turned bleak. The export target for the year which was fixed at $10.1 billion earlier in July 2001 was no more considered to be a realistic one, and therefore its downward revision to $9 billion was seen as a reasonable target. The achievement of even this level of exports looked very much doubtful in the face of the adverse circumstances mentioned above.
According to foreign trade data, the exports stood at $9.12 billion during the financial year of 2001-2002, showing a nominal decrease of 0.85% over the export performance of $9.20 billion for fiscal 2000-01. Originally, Pakistan had fixed the target of $10.1 billion for the current fiscal year but after the event of September 11, the target was revised down by $1 billion by the end of the last fiscal year.
The imports during the 12 months of the last fiscal stood at $10.335 billion, showing a decrease of 3.67% against the corresponding period of fiscal 2000-2001 when the imports stood at $10.73 billion.
Pakistan's trade gap continues to widen during the last fiscal and reached at 1.21 billion against $1.53 billion during the fiscal year 1999-2000, showing a reduction of 20.65%. The exports showed positive sign in June with a growth of 0.17% against corresponding period of last year as exports stood at $953.49 million against $951.96 million during the same month of last fiscal year.
The imports also rose by 4.94% in June against the corresponding month of last fiscal year as it stood at $971.03 million against $925.58 million in the corresponding month of the last fiscal year. The exports stagnated around $8.5 billion in 1996-97 in 1998-99 slumped down to $7.7 billion while during 1999-2000 it went to $8.56 billion, during 2000-01 $9.2 billion and it was the second time in the history of Pakistan that the exports crossed the $9 billion mark.
Official sources termed the crossing of exports figure of $9 billion as a big achievement in view of global recession after 9/11 incidents in the United States. It may be noted that the export target of $10.1 billion fixed for the last financial year started looking like a tall order, thereby, to the downward revision to $9 billion. Needless to point out that attainment of the revised target was deemed, at times, as a challenge. Now that export receipts for the year have been recorded at $9.12 billion, thereby exceeding the revised target, it means quite some achievement, although revealing a small decline compared to the preceding year's earnings. Again, although quite some credit for this will go to the country's export industries as they kept relentlessly fighting the adverse situation, it could not have been possible except through the laudable enabling gesture of greater market access allowed by the European Union to Pakistan's exports. The concessions allowed included duty free entry of a number of value-added goods, besides 15 per cent increase in Pakistan's textile export quota. Mention, in this regard, may also be made to the spirit of accommodation demonstrated by the United States, evidently by way of facilitating Pakistan as a dependable member of the war against terror in its close neighbourhood.