Pakistan’s central bank shows US as top export destination

State Bank data points out $15.518 million exports to India during current financial year against $182.207 million during the last year

State Bank data calls China as third top export destination where Pakistan exported products worth $727.480 million during current financial year

State Bank data calls China as third top export destination where Pakistan exported products worth $727.480 million during current financial year

The United States remained the top export destinations of the Pakistani products during the first five months of the current financial year (2019-20), followed by the United Kingdom and China.

The total exports to the United States during July-November (2019-20) were recorded at $1744.415 million against the exports of $1698.809 million during July-November (2018-19), showing an increase of 2.68 percent during the period under review, according to the State Bank of Pakistan.

This trend was followed by UK, wherein Pakistan exported goods worth $728.120 million against the exports of $753.054 million last year, showing a decreased of 3.31 percent. China was the at third top export destination, where Pakistan exported products worth $727.480 million during the current financial year against the exports of $741.643 million during last fiscal year, showing nominal decrease of 1.90 percent, the data showed.

State Bank data calls China as third top export destination where Pakistan exported products worth $727.480 million during current FYAmong other countries, Pakistani exports to the United Arab Emirates (UAE) stood at $663.883 million against $538.786 million during the last year, showing increase of 23.21 percent while the exports to Germany were recorded at $533.048 million against $549.071 million last year, the data showed.

EXPORTS TO BANGLADESH

During the first five months of the financial year, the exports to Afghanistan were recorded at $432.465 million against $460.461 million whereas the exports to Spain stood at $380.249 million against $379.083 million. Pakistan’s exports to Italy were recorded at $324.971 million against $322.660 million last year.

The exports to Bangladesh stood at $297.676 million against $314.108 million. Similarly, the exports to Belgium during the current financial year were recorded at $226.668 million against $252.240 million while the exports to France stood at $188.902 million against $192.340 million.

During first five months of financial year, the State Bank record exports to Afghanistan at $432.465 million against $460.461 million

During the current financial year, Pakistan’s exports to Singapore were recorded at $109.006 million compared to $119.586 million last year. The exports to Japan stood at $84.113 million against $91.932 million, to Indonesia $32.412 million against $138.031 million whereas the exports to India stood at $15.518 million during the financial year against $182.207 million during last year.

PACE OF EXTERNAL DEBT, LIABILITIES

In the recently-published quarterly report – The State of Pakistan’s Economy, the State Bank said that the pace of external debt and liabilities had slowed down during the first quarter (July-September) of the fiscal year 2019-20 as compared to same period of the last year.

The external debt and liabilities increased by $0.5 billion during the period under review compared to an increase of $0.9 billion during the same period of the last year. The report said that improvement in current account balance, revaluation gains due to depreciation of major currencies against the dollar, and higher external debt servicing were major factors that explain a slowdown in accumulation of the external debt.

Nonetheless, the first International Monetary Fund (IMF) tranche of almost $1 billion, and fresh disbursements of bilateral loans by China and multilateral loans by the Asian Development Bank (ADB) and the Islamic Development Bank (IDB), increased the stock of external debt during the period under review. It said that revaluation gains due to the depreciation of major currencies against the dollar reduced the dollar value of the country’s external debt by roughly $0.7 billion during Q1-FY20.

More than one-half of these gains were due to the US dollar’s appreciation against the Special Drawing Rights (SDR) during the period. Foreign investors (mainly from the US and the UK) took keen interest in government securities during the first quarter of FY20, as they made investments worth $0.3 billion in T-bills.

EXTERNAL DEBT SERVICING

This investment was an outcome of the continued improvement in the country’s BoP position and reserve buffers; sustainability of the exchange rate regime; and the comfort offered by the inception of the IMF programme. External loan disbursements more than doubled in the period under review over the same period last year.

Specifically, disbursements from commercial banks, ADB and IDB increased considerably. Most of these disbursements were for financing purposes (non-project-based). Pakistan’s external debt servicing amounted to $3.0 billion during Q1-FY20, up from $2.5 billion during Q1-FY19.

Similarly, principal and interest payments were both higher during the period under review, with debt servicing of commercial loans almost five times higher as compared to the last year. The interest payments on bilateral and commercial loans increased considerably in the first quarter of FY20 over the corresponding period of the last year.

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