KARACHI, Nov 28: There has been a constant decline in the country’s exports for the fourth consecutive month of the current fiscal, which is alarming not only for the balance of trade alone but also indicates that some serious problem is ailing the economy as a whole.

No matter what economic wizards may say in Islamabad in their defence, and even if they suggest some sweet pill to correct the situation easily and induce economy back to the healthy position, the fact remains that in October the trade deficit bulged close to $2 billion.

Beside, the widening of balance of trade, the economy, at present, is confronted with multiple issues on the manufacturing and agriculture sectors.

If the situation is not corrected immediately, it is feared that soon the service sector, which is thriving, may also fall in line and have a snowball affect on economy as a whole.

The biggest indicator of the weakened economy could well be taken from the fact that rupee had depreciated against US dollar which, otherwise, itself is losing ground against major currencies of the world.

However, economic planners in Islamabad are not ready to accept this fact, and they continue to count gains, and say that they have achieved economic growth. This may have relevance with the recent past, but they are yet to narrate the correct current economic situation.

Total exports in October stood at $1.409 billion as against $.558 billion recorded in July 2007, thereby showing a staggering decrease of 9.5 per cent in the first four months of the current fiscal.

The textile industry, which is the largest manufacturing sector of the country and also earns up to 65 per cent in exports, is rapidly heading towards a total collapse owing to high cost of production which has rendered it uncompetitive in the world market.

There was a constant fall in textile exports during the first four month of the current fiscal. In October, these declined to $837 million as against $931 million, a decrease of 10.1 per cent against the corresponding period of last year.

Against this, imports touched $3.385 billion during October.

So far, remittances received from overseas Pakistanis and sale proceeds realised from the sale of national assets helped meet trade deficit, but the question is how long this will go on because there would be a time when trade gap would be wider, if current falling trend in exports was not arrested.

The weakening economy’s position could well be judged from the fact that the State Bank had to defend the weakened rupee last week by using $80 million out of its valuable reserves. If this trend continues, the SBP would have a tough time to defend the rupee.

On the agriculture sector, almost all the cash crops have failed to meet the target. The government’s projection of cotton production of 14.3 million cotton bales this year has been revised downward to 12.8 million bales, but private estimates put it further lower at 11 million bales.

The cotton crop was severely damaged by mealy bug and curl leave virus (CLV) and there was no one to guide growers or even make available relevant pesticide which could have controlled the damage.

Similarly, there had been wheat and rice crises, because both the major crops were badly handled by the government, and it resulted in an acute shortage and price hike in the domestic market.

The sugarcane is not having a different story and like every year, there is price war between growers and millers over the cane.