ISLAMABAD, July 12: Pakistan’s merchandise trade gap with the rest of the world witnessed a paltry growth of over one per cent in 2010-11 over the previous year owing to highest-ever increase in exports and steep fall in imports.

As a result, the trade balance went up to $15.587 billion in the outgoing fiscal year from $15.420 billion over the previous year, showing a marginal increase of 1.08 per cent, suggested data of Federal Bureau of Statistics on Tuesday.

The overall trade deficit deteriorates by $167 million during the period under review over the previous year. This imbalance in trade could only be contributed to higher flood-related imports in the months of Nov- Dec.

Since January 2011, the trade deficit was improving against the corresponding months last year owing to buoyancy in monthly export growth combined with slowdown in imports.

In the budget last year, the government projected a trade deficit at $15.6 billion on the back of export proceeds at $19.87 billion and imports at $35.474 billion.

However, the global price hike of commodities, especially of cotton based textile group pushed up the over all exports volume from the country by end June 2011.

But contrary to this, for current year the government forecast a trade deficit at $17.292 billion as its rebounding economy raises demand for manufacturing and oil imports. The oil and eatable imports bill also expected to swell in the year 2011-12.

In the outgoing fiscal year, the slow down in trade deficit also accrued, especially because of lower demand of raw materials imports from the manufacturing sector confronting energy shortages coupled with poor law and order situation.

As a result of improvement in trade balance, the current account deficit also turned to surplus of $205 million in July-May period from deficit of $3.402 billion last year.

And it is projected that on the back of the highest ever growth in exports and remittances, the outgoing fiscal year will end without deficit.

Pakistan’s merchandise exports reached $24.827 billion in 2010-11 as against $19.290 billion over the previous year, showing an increase of 28.7 per cent.

In June, the exports soared 36.27 per cent to $2.427 billion as against $1.781 billion same month last year.

The government has projected an export target of $25.618 billion for the current fiscal year. This target was projected on the back of a claim that Pakistan’s textile and clothing exports could reach over $15 billion for the year 2011-12.

But contrary to this, chairman All Pakistan Textile Mills Association Gohar Ijaz put the figures at $20 billion but conditioned it with energy supply and reduction in interest rate.

On the other hand, import bill went up by 16.43 per cent to $40.414 billion in the outgoing fiscal year as against $34.710 billion last year.

The government has projected an import target at $42.910 billion in 2011-12. This alone includes the import bill of petroleum products, which could reach $12 billion and over $4 billion import of eatables in the year under review.