ISLAMABAD: Pakistan’s trade deficit with the Middle East increased 5.14 per cent to $6.558 billion in the first half of the current fiscal year from $6.237bn over the same period last year due to the rise in petroleum imports.

The widening trade gap would concern policymakers mainly because of the rising imports of petroleum products from the region. At the same time, exports record a paltry growth to a few countries, according to the figures compiled by the State Bank of Pakistan.

Petroleum consumption has risen in the current fiscal year because the crude oil import surged 16.15pc in quantity in the first half year of FY25 from a year ago.

In FY24, the imbalance with the Middle East narrowed by 20.47pc to $13.014bn from $16.365bn over the preceding year, mainly due to lower petroleum imports amid falling consumption owing to rising local prices.

Exports to the Middle East rose 6.04pc to $1.597bn in July-December from $1.506bn over the same period last year. In FY24, the exports to the region grew 35.23pc to $3.155bn compared to $2.33bn in the preceding year.

At the same time, Pakistan’s imports from the Middle East also saw an increase of 5.32pc to $8.155bn in July-December from $7.743bn over the same period last year. In FY24, the imports declined 13.53pc to $16.16bn compared to $18.69bn in the same period the preceding year.

Pakistan recently signed a free trade agreement with the Gulf Cooperation Council (GCC) states to minimise its trade imbalance.

The demand for Pakistani products surged in the United Arab Emirates (UAE), Saudi Arabia and Qatar during the period under review.

Exports to Saudi Arabia rose 10.88pc to $363.97m in July-Dec from $328.23m over the last year. In FY24, exports to Saudi Arabia rose 40.98pc to $710.335m from $503.851m in FY23. The imports from the kingdom saw a decline of 24.58pc to $1.807bn against $2.396bn in the same period last year.

In FY24, imports from Saudi Arabia declined by 0.01pc to $4.49bn against $4.50bn in the preceding year.

Exports to UAE increased 8.8pc to $1.088bn in July-Dec from $1bn over the last year. In FY24, exports to the UAE surged 41.15pc to $2.082bn from $1.475bn in FY23, primarily due to a significant rise in exports to Dubai.

Pakistan’s top export products to the UAE include rice, bovine carcasses, men’s and boys’ cotton ensembles, guavas and mangoes. In July-Dec, the imports from UAE also witnessed an increase of 24.9pc to $3.821bn from $3.059bn over the last year month.

Exports to Bahrain declined by 24.69pc to $26.75m in 6MFY25 from $35.52m in the corresponding period last year. The imports from Bahrain increased 73.18pc to $80.86m in 6MFY25 from $46.69m.

Exports to Kuwait decreased 4.62pc to $59.18m in 6MFY25 from $62.05m over the previous year. However, imports increased by 4.33pc to $809.73m from $776.12m.

Pakistan’s exports to Qatar saw a negative growth of 26.26pc to $59.51m in the first six months of the current fiscal year against $80.71m over the corresponding months of last year. The import from Qatar stood at $1.637bn during the first half of the current fiscal year from $1.466bn over the last year, indicating an increase of 11.66pc.

Published in Dawn, February 2nd, 2025