Pakistan's trade imbalance has deepened in the current fiscal year, as exports declined while imports rose sharply, signalling renewed pressure on the country's external sector.
According to provisional figures from the Pakistan Bureau of Statistics, exports during July-January FY2025-26 stood at Rs5.12 trillion, marking a 6 percent decline from Rs5.45 trillion in the same period last year. The contraction in outbound shipments contrasts with a notable increase in import spending, which climbed 10.89 percent to Rs11.35 trillion.
The widening gap between earnings from exports and payments for imports underscores growing strain on the trade balance, even as short-term indicators show some improvement. On a year-on-year basis, exports in January 2026 rose by 4.03 percent to Rs855.5 billion, while month-on-month figures recorded a sharp increase of 34.57 percent from December levels.
Despite this recent uptick, the overall trend remains subdued. Key export categories in January included readymade garments, knitwear, bedwear and rice, along with cotton-based products and petroleum goods. These sectors continue to dominate Pakistan's export profile, reflecting a concentration in textiles and selected commodities.
On the import side, the composition highlights strong demand for energy and industrial inputs. Major items included crude oil, palm oil, petroleum products, liquefied natural gas, iron and steel, plastic materials and electrical machinery. Consumer-related imports such as mobile phones and motor vehicles also featured prominently.
Monthly import data suggests a slight easing in January 2026, with total imports declining by 4.53 percent compared to December and marginally by 0.35 percent compared to January last year. However, this moderation has not been sufficient to offset the cumulative rise over the fiscal year.
The data points to a persistent structural imbalance. While exports show intermittent recovery, their overall decline, combined with sustained import demand, continues to widen the trade deficit.
The figures reinforce a familiar pattern in Pakistan's external sector: reliance on a narrow export base alongside heavy dependence on imported energy and raw materials. Without a stronger and more consistent expansion in export earnings, the pressure on the trade balance is likely to persist.