Exports in Jan log steepest decline in two-and-a-half years

Registering the steepest decline in two and a half years, exports contracted by 11.19 per cent to USD 23.88 billion in January but trade deficit improved marginally because of cheaper oil imports.

The trade deficit in January narrowed to USD 8.32 billion from USD 9.45 billion in the same month last year. This is its lowest level in the past eleven months.

Declining prices of oil in the international market has impacted the country's imports, which dipped by 11.39 per cent year-on-year to USD 32.2 billion.

The oil import bill declined by 37.46 per cent to USD 8.24 billion in January this year."The further decline in the size of the merchandise trade deficit is along expected lines, given the correction in crude oil prices," ICRA said in a statement.

Gold imports in January this year grew by 8.13 per cent to USD 1.55 billion.The drop in exports in January 2015 is the steepest since overseas shipments contracted by 14.8 per cent in July 2012.

Exports in January 2015 were in negative zone for the second consecutive month.The decline in exports was mainly on account of poor demand from the European and Japanese markets.

All the major sectors including cotton yarn, chemicals, pharmaceuticals and gems and jewellery, tea, coffee, rice, tobacco and spices have recorded a negative growth in the month under review.

"Although the US is showing improvement, the poor economic situation in the EU and also Japan has led to the contraction in exports. Government should take pro-active measures to boost exports and also come out with the foreign trade policy as early as possible," FIEO President Rafeeq Ahmed said.
For April-January period of the current fiscal, exports grew by 2.44 per cent to USD 265.03 billion.

Imports were up by 2.17 per cent to USD 383.41 billion in the same period, leaving a trade deficit of USD 118.37 billion during the period.