ISLAMABAD: Imports of the petroleum group dipped 11.66 per cent year-on-year in the July-March period of FY23 owing to the sharp reduction in consumption as a result of the slowing down of the economy amid unprecedented inflation.

The highest-ever increase in prices in the country’s history also contributed to lower consumption of petroleum products. At the same time, not only did the local production decline but the export of petroleum products from the country also posted negative growth.

In absolute terms, the total import value of the petroleum group fell to $13.08bn in 9MFY23 from $14.81bn over the corresponding months of last year.

Data compiled by the Pakistan Bureau of Statistics (PBS) showed the imports of petroleum products declined by 19.91pc in value during 9MFY23 and 34.01pc in quantity. Import of crude oil decreased by 12.72pc in quantity while the value increased by 4.69pc.

Similarly, liquefied natural gas (LNG) imports fell by 14.11pc during July-March FY23 on a year-on-year basis. This would have translated into relatively lower LNG-based power generation — a replacement for furnace oil. On the other hand, liquefied petroleum gas (LPG) imports jumped 3.78pc during the months under review due to domestic shortages.

In March, total oil imports declined by 35.19pc to $1.20 billion, from $1.86bn in the same month last year.

The PBS is yet to release March data for local production of petroleum products, but figures from the first eight months showed a 9.43pc drop over a year ago.

The exports of the petroleum group also declined by 8.42pc in 9MFY23 from a year ago. This was mainly contributed by a decline of 4.74pc in exports of crude oil and a 19.94pc decline in exports of petroleum products during the months under review.

For many years machinery imports have been a major reason for the growing trade deficit, but it registered negative growth of 48.18pc to $4.49bn in 9MFY23 from $8.67bn in the corresponding period last year mainly due to a year-on-year decline of 62.08pc in the arrivals of telecom equipment including mobile phones.

The import of mobile phones declined by over 71pc in 9MFY23 from a year ago. Similarly, the import of textile machinery, office machinery, power generating machinery, agriculture machinery and electrical appliances posted a massive decline during the period under review.

The import of the transport sector dipped 54.38pc to $1.53bn in 9MFY23 against $3.36bn over the corresponding period of last year. The decline was seen in the imports of CBU vehicles as well as CKD because of lower local production of vehicles as the government has restricted the opening of letters of credit.

Published in Dawn, April 20th, 2023