Irfan Ahmed

Pakistan’s services trade deficit shrank by 9.48% in the first month of the fiscal year 2022-23 to $259.86 million from $287.06 million in the first month of the fiscal year 2021-22, WealthPK reported quoting data released by Pakistan Bureau of Statistics (PBS).

The export of services from the country witnessed an increase of 7.96% to $530.07 million in the first month of this financial year (2022-23) as compared to $490.99 million in the same month of the previous fiscal year (2021-22).  

Meanwhile, the services’ imports also rose by 1.53% to $789.93 million in the first month of the fiscal year 2022-23, compared to $778.05 million in the same period of the fiscal year 2021-22.

Source: PBS website/WealthPK research

A comprehensive IT Export Strategical Framework was created by the Pakistan Software Board for the purpose of promoting IT exports. Different programmes and schemes are being implemented accordingly through various projects relating to infrastructure development, human capital development, company capability development, global marketing, strategy and research and promotion of innovation and technologies.

Government projections for 2022-23 include $10 billion for services and $35 billion for merchandise exports. According to the PBS, the country’s services trade deficit also decreased by 61.90% month-on-month to $259.86 million in July 2022, against $682.11 million in the previous month (June 2022).   

On a month-on-month basis, imports of services decreased by 40.02% in July 2022, to $789.93 million from $1.316 billion in June 2022. Furthermore, the export of services shrank by 16.51% in July 2022, to $530.07 million from $634.87 million in June 2022, the data showed.  

Source: PBS website/WealthPK research

The country’s overall exports narrowed by 5.17% in the month of July 2022, reaching $2.219 billion, down from $2.340 billion during the month of July 2021.

The sum of all imports shrank by 12.81% and remained at $4.861 billion in July 2022, compared to $5.575 billion during the month of July 2021.

The country’s total trade deficit decreased by 18.33% to $2.642 billion in the month of July 2022, compared to $3.235 billion in the corresponding month of 2021, WealthPK reported.   

Source: PBS website/WealthPK research

IT-related services grew at the fastest rate ever, pushing up the overall export figure. The services exports also include finance and insurance, transport and storage, wholesale and retail trade, public administration and defense sectors.

The services sector has risen to become the primary engine of economic growth, contributing 61% of Gross Domestic Product (GDP) in 2020-21, up from 56% in 2005-06.

During fiscal year 2022-23, both the government and the State Bank of Pakistan are aggressively promoting this rapidly expanding services sector, particularly by easing export revenues and providing tax breaks and incentives.

Credit : Independent News Pakistan-WealthPk