By Hamza AmeerIslamabad, March 4 : Pakistan’s economic situation continues to worsen with each passing month as the country’s exports have plunged for a successive second month to slightly over $2 billion in February 2021.
As per the Pakistan Bureau of Statistics (PBS), contrary to over 4 per cent contraction in exports, the imports increased one-tenth to $4.6 billion last month on an annualised basis, which resulted in further widening of trade deficit by almost 24 per cent in February 2021 on a year-to-year basis.
Economists say that the latest plunge has proven that the recent peak in exports was the result of some external factors and policy measures, which includes 30 per cent currency devaluation.
“The gap between imports and exports increased to $2.5 billion in February over a year ago, a jump of $486 million of 24 per cent”, maintained PBS.
Exports had started picking up early in the current fiscal year and peaked up to $2.4 billion in December, prompting a celebratory response from the ruling government.
However, the short-term achievement proved to be adversely affective as the exports again started falling down previous historic band of around $2 billion.
Experts say “every successive government has doled out billions of rupees in subsidies to the exporters every year on account of cheap loans, electricity and gas.The exporters also pay a nominal tax on their income.Yet, they have failed and the government does not seem ready to review its flawed strategy of pampering few hundred exporters”.
Exporters say that the increase in exports during the previous months was due to shifting of global trade from China towards South Asian countries and replacing the dried out inventories by the buyers in the US and Europe after the global economy gradually started recovering from the effects of novel coronavirus.
“One a month-to-month basis, the exports decreased over 4.5 per cent to $2.4 billion”, maintained PBS.
“There was a $97 million in export receipts in February as compared to the previous month.The imports also registered a decline of 5.2 per cent last month”, the PBS added.
The ruling government of Prime Minister Imran Khan has already fallen short of its annual export target consistently in its first two years of ruling.For the current year, the government has set export target at $22.7 billion, which experts say will require a 6.2 per cent growth.
“This seems like an uphill task, given the fact that the little growth in exports have been disputed by the central bank.Exports in the first six months were equal to only 72 per cent of the annual target”, said economic expert Shahbaz Rana.