Pakistan Trade Deficit Soars in December 2024, Reaching $2.5 Billion

Pakistan’s trade deficit rose by thirty-seven percent year-on-year in December twenty twenty-four to two point five billion dollars, marking the highest monthly deficit since April twenty twenty-four. This increase was driven by a significant rise in imports, which reached five point four billion dollars, while exports recorded a modest three percent year-on-year growth to two point nine billion dollars, according to the Pakistan Bureau of Statistics.

Imports for December twenty twenty-four climbed sixteen percent year-on-year and twenty percent month-on-month to five point four billion dollars, the highest since August twenty twenty-two. Total imports during the first half of the fiscal year twenty twenty-five amounted to twenty-seven point eight four billion dollars, reflecting a seven percent year-on-year increase, while exports rose by eleven percent year-on-year to sixteen point six four billion dollars.

The cumulative trade deficit for the first half of fiscal year twenty twenty-five increased slightly by zero point four percent year-on-year to eleven point two billion dollars, compared to eleven point one five billion dollars during the same period last year.

The petroleum group remained the largest contributor to the import bill, with imports valued at one point six six billion dollars, showing a seven percent year-on-year rise. Within this category, crude oil imports increased by sixteen point one five percent in quantity to four point nine eight million tonnes, although petroleum product costs declined by seven percent.

Food imports saw significant growth, rising thirty-two percent year-on-year to eight hundred and three million dollars, driven by higher purchases of essential items. Machinery imports grew twelve percent year-on-year to eight hundred and fifty-eight million dollars, led by textile machinery, which rose fifty-three point nine percent, and electrical machinery, which increased by thirty-one point three percent.

Textile imports surged by one hundred and thirteen percent year-on-year to four hundred and thirty-one million dollars, reflecting greater reliance on imported raw materials. Transport imports rose five percent year-on-year to one hundred and ninety-one million dollars, while agricultural and chemical imports increased eleven percent year-on-year to seven hundred and eighty-seven million dollars.

Exports in December twenty twenty-four totaled two point nine billion dollars, a three percent year-on-year and month-on-month increase. The textile sector led exports with earnings of one point four eight billion dollars, up six percent year-on-year. Ready-made garments recorded the highest growth within the textile sector, rising twenty percent year-on-year to three hundred and fifty-seven million dollars. Knitwear exports increased seven percent to three hundred and ninety-two million dollars, while other textile products saw a one percent decline.

Exports of manufactured goods, including chemicals and pharmaceuticals, rose twenty-one percent year-on-year to three hundred and ninety-one million dollars. However, petroleum and coal exports fell eighteen percent year-on-year to thirty-five million dollars. Food exports dropped four percent year-on-year to eight hundred and five million dollars, reflecting weaker demand for agricultural products.

With the trade deficit at two point five billion dollars in December and overall imports nearing twenty-eight billion dollars for the first half of fiscal year twenty twenty-five, policymakers face the challenge of reducing non-essential imports and enhancing export competitiveness to stabilize external accounts.

The Federation of Pakistan Chambers of Commerce and Industry’s Businessmen Panel has emphasized that while the current account surplus is a positive development, the widening trade deficit, driven by imports surpassing five billion dollars, presents risks to external account stability