Sluggish textile sector, rice exports plunge: Q1 trade deficit balloons to USD9.4bn

ISLAMABAD: Sluggish performance of the textile sector and a sharp decline in the rice exports are seen as factors mainly responsible for ballooning the trade deficit to USD 9.4 billion in the first quarter of 2025-26.

According to detailed external trade figures issued by the Pakistan Bureau of Statistics, the exports in the July-September period of FY26 declined by 3.88 percent to USD 7.6 billion compared to USD 7.9 billion in the corresponding period of the previous year.

During the July-September period, the imports totalled USD 17 billion compared to USD 14.95 billion in the corresponding period of last year, showing an increase of 13.9 percent.

In the first quarter of FY26, the food exports declined by 31.42 percent. In the food category, rice exports are down by 42 percent, among which Basmati rice and others (IRRI 6 & IRRI-9) declined by 43.64 pc and 41.10 pc, respectively, on a year-on-year (YoY) basis.

Due to floods and torrential rains in the country, the vegetables and tobacco exports also declined by 41 percent and 48 percent, respectively, on a YoY basis. Whereas sugar export remained nil, and oil seeds, nuts, and kernals exports reduced by 68 percent. Fish and fish preparations exports up by 28 percent, and fruits by 17 percent.

The textile exports in the first quarter increased by 5.63 pc. In the sub-categories of textile, knitwear exports up by 12 percent, cotton cloth 12 percent, readymade garments 6percent, towels 7 percent, tents, canvas & tarpaulin 38 percent, and made-up articles (Excluding towels &bedwear) 8 percent. Whereas cotton cloth exports declined by 14 percent, and raw cotton exports remained zero in this period.

Among other manufacturing groups, carpet rugs and mats exports are down by 13 percent and tanned leather by 4 percent. Whereas cement exports are up by 52 percent and sports goods exports, including footballs and gloves, by 19 percent.

During September, the food exports declined by 4 percent on a month-on-month (MoM) basis and 45 percent on a YoY basis. Rice exports are down by 59 percent on a YoY and 29 percent on a MoM basis. In rice categories, Basmati rice exports declined 42 percent on a YOY and 21 percent on a MoM basis. The other rice species (IRRI-6 & 9) nose-dived by 66 percent on a YoY basis and 33 percent on a MoM basis.

The fruit exports are down by 15 percent on a YoY and 41 pc on a MoM basis, and the vegetable exports declined 37 percent on a YoY and 3 percent on a MoM basis. Tobacco exports also declined by 21 percent on a YoY and 661 pc on a MoM basis.

The fish and fish preparations exports up by 24 percent on a YoY and 82 percent on a MoM basis, and the meat and meat preparation exports increased by 12 percent on a YoY basis and 25 percent on a MoM basis.

In September, textile exports declined by 2 percent on a YoY and 3 percent on a MoM basis. Cotton yarn exports up by 23 percent and down by 0.24 percent on a MoM basis, knitwear up by 5 pc on a YoY basis and 4 percent ona MoM basis, bedwear exports are up 0.28 percent on a YoY and 6 pc on a MoM basis, tents, canvas & tarpaulin up by 156 percent on MoM and YoY basis. Whereas cotton cloth exports declined by 24 percent on YoY and 5 pc on MoM basis.

Among the major imports in September FY26, petroleum crude increased by 13 pc on a YoY basis and 10 pc on a MoM basis. Petroleum products imports increased by 20 pc on a YoY basis and 14 percent on a MoM basis, and palm oil is up by 45 percent on a YoY basis and 7 percent on a MoM basis. Mobile phone imports up by 97 percent on a YoY basis and 28 pc on a MoM basis.

The iron & steel scrap imports are up by 12 percent on YoY basis and 15 percent on a MoM basis. Electrical machinery & apparatus imports declined by 4 percent on a YoY basis but increased by 17 percent on a MoM basis, plastic materials increased by 24 percent on a YoY basis but down by 1 percent on a MoM basis, and iron & steel up by 19 percent on a YoY basis but down by 4 percent on a MoM basis.

Motor cars (CKD/SKD) imports up by 92 percent on a YoY basis but down by 11 pc on a MoM basis. Natural gas, LNG reduced by 33 pc on a YoY basis and 25 percent on a MoM basis.

Copyright Business Recorder, 2025