FPCCI flags 15% widening of Pakistan's trade deficit in first quarter
Pakistan's trade deficit widened by 15.13% to $10.8bn during July-September 2026, the first quarter of fiscal year 2026-27, up from $9.4bn in the same period a year earlier, according to Pakistan Bureau of Statistics figures cited by Atif Ikram Sheikh, president of the Federation of Pakistan Chambers of Commerce & Industry. In a statement issued on Monday, Sheikh said the growing import bill threatens the country's macroeconomic stability and will put pressure on national foreign exchange reserves.
Sheikh said the trend persisted through to the end of the quarter. He attributed the wider gap to what he described as the exceptionally high cost of doing business in Pakistan, which he said severely hampers the competitiveness of local manufacturers against regional peers. Among the barriers he cited were prohibitive interest rates, large capacity charges on electricity and elevated petroleum levies, which he said hold back industrial productivity and value addition.
The FPCCI president warned that without immediate structural interventions, continued reliance on imports to meet domestic demand would further exhaust the national exchequer and risks triggering a balance of payments crisis.
To protect the FY27 export targets and prevent what he called widespread industrial stagnation, Sheikh said the FPCCI is urging the Ministry of Finance and the State Bank of Pakistan to reduce the policy rate aggressively to single digits, so manufacturers can obtain affordable working capital. He also called for the rationalisation of electricity and gas tariffs to bring them into line with regional competitors, alongside targeted relief on inland logistics to lower domestic supply chain costs. The figures and warnings are drawn from the FPCCI's statement and its reading of the PBS data.
