Pakistan’s exports to China experiencing consistent growth in FY23-24
Published on: December 15, 2023.
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FY23-24 Witnesses Impressive Growth in Pakistan’s Exports to China
Pakistan has experienced a significant increase of 40.36% in its exports of goods and services to China during the first four months of the current fiscal year (2023-24) compared to the same period last year, according to a report by WealthPK. The State Bank of Pakistan (SBP) reveals that the total exports to China between July and October amounted to USD 952,216 million, a substantial rise from the USD 678,386 million recorded during the corresponding period in the fiscal year 2022-23.
Moreover, there was a year-on-year increase of 79.74% in exports to China, with October 2023 seeing exports amounting to USD 318,842 million compared to USD 177,386 million in October 2022.
The data from the central bank also indicates a 17.32% decline in imports during the first five months of the current fiscal year, totaling USD 21.550 billion, as opposed to USD 26.064 billion during the same period last year.
The SBP data further reveals that exports to worldwide destinations during the July-October period of 2023-24 amounted to USD 9,617 million, representing a 0.66% increase from USD 9,554 million recorded during the first four months of the previous financial year.
Dr. Ghulam Samad, a Senior Trade Economist and International Trade and Commerce Expert, commented on this notable increase in trade activities between Pakistan and China. He stated that the strengthening economic relations have been driven by various factors contributing to the growth in exports. Dr. Samad emphasized the importance of bilateral trade agreements and cooperative initiatives between the two countries in fueling this upward trajectory.
However, Dr. Samad also pointed out that Pakistan’s exports remain low, despite the government’s support to the industrial sector during this period. He acknowledged that this export stagnation presents challenges such as an increasing current account deficit, external debt burden, and other macroeconomic issues.
Pakistan’s potential export areas face limitations since China has surpassed Pakistan in most of its major manufacturing sectors. For example, the textile industry, which is crucial for Pakistan’s exports, has not witnessed a sufficient increase in trade volume due to China’s position as a major textile producer. Pakistan primarily exports low value-added textile products to China.
Dr. Samad emphasized how the China-Pakistan Free Trade Agreement (CPFTA) enables Pakistani exporters to enhance their exports to the Chinese market. He believes that the CPFTA is a beneficial deal for both parties and encourages Pakistani exporters to take full advantage of it.
Cotton, copper, grains, fish, crustaceans, aquatic invertebrates, oilseeds, fruits, beverages, aluminum, clothing, salt, sulphur, gypsum, lime, cement, leather, and plastics are among the top commodities Pakistan exports to China, as per WealthPK’s research.
On the other hand, Pakistan imports electrical and electronic equipment, machinery, nuclear reactors, boilers, pharmaceuticals, mineral fuels, oils, distillates, organic chemicals, iron and steel, machinery excluding railways, plastics, fertilizers, rubber, tanning products, coloring extracts, tannins, pigments, miscellaneous chemical products, glassware, thread, copper, footwear, and toys from China.
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