ISLAMABAD, Dec 6: Amid strong indications that exports would remain $1.5-2 billion short of annual target, Pakistan’s trade deficit has reached $434 million during first five months (July- November) of the current fiscal year against an annual target of $900 million.

Provisional trade figures available with Dawn suggest that total exports during five months (July-November) this year have amounted to $3.735 billion compared with $3.724 billion recorded in the same period last year, showing an improvement of 0.29 per cent.

Similarly, five months’ imports have amounted to $4.169 billion compared with $4.641 billion during the first five months of last year, posting a negative growth of around 10 per cent.

Initial analysis of the trade figures of first five months suggest that although the trade deficit was within the annual target parameters, exports target of $10.1 billion would not be achievable in the existing circumstances. Similarly, the import target of $11 billion is estimated to remain short of target by $1 billion.

According to Federal Bureau of Statistics (FBS), exports during the first month of November 2001 amounted to $709.966 million compared with $753.940 million achieved in the year-ago period, showing a decline of 5.8 per cent.

Imports in November stood at $826.587 million, down from $930.347 million recorded a year earlier, an 11 per cent decrease. In this way, monthly trade deficit in November amounted to $116.6 million against $176 million trade deficit of November last year.

The shortfall in exports would have direct impact on the overall economy, particularly the revenue target that has already been slashed to Rs430 million against budgeted target of Rs457 billion.

On the imports front, decline has apparently two main reasons. Slowdown in industrial growth and sluggish economic activity as a result of post-September 11 events and decline in petroleum imports, both in terms of quantity and value, again due to slow industrial and commercial activity and decline in international oil prices.

Till last month, i.e. (July-October) oil imports had declined by 23.50 per cent and stood at $1.004 billion against $1.312 million of the same period last year.

In terms of value, import of petroleum products declined by 36 per cent and amounted to $521 million during four months of current year against $818 million last year.

Similarly, the import of crude oil declined by 2.45 per cent during first four months of current year and stood at $482 million against $494 million same period last year.

Interestingly, the quantity of the import of petroleum products increased by around 21 per cent and stood at 33 million tons against 45 million tons last year despite the fact that domestic refineries were running at 70 per cent capacity.

The fall in value of oil imports is attributed to fall in international oil price and decline in consumption. Had the refineries worked at full capacity, the import bill would have been even lower.