According to the latest data released by the Ministry of Commerce, there has been a record 103% increase in the country’s imports compared to last year, leading to a trade deficit. A trade deficit occurs when imports surpass exports. In the current fiscal year, the merchandise trade deficit reached 15.525 USD in July-October compared to 7.617 USD over the corresponding months last year.
The import of the COVID-19 vaccine formed 11% of the total import increase this year as the government aims to immunize the majority of its population. Petroleum products, coal, and gas imports posted a growth of 34%, with food and other consumer goods increasing by 8% and 2% respectively.
The rising import bill poses a serious threat to the fiscal side of the economy as it can push the current account to $10 billion in FY 22. The trade gap had been increasing since December last year, mainly led by an exponential growth in imports and stagnant exports.
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