Pakistan's goods trade deficit with the United States has narrowed significantly, driven by a surge in exports. Official data shows that the deficit fell by 12% in 2024 compared to the previous year, as exports rose by 8% while imports remained relatively stable.
Export Growth Highlights
Key export sectors contributing to this growth include textiles, leather goods, and surgical instruments. Textile exports alone increased by 10%, accounting for over 60% of total exports to the US. The appreciation of the Pakistani rupee against the dollar also helped boost export competitiveness.
Factors Behind the Improvement
- Stronger demand from US markets for Pakistani products, particularly in the textile and apparel sector.
- Government incentives for exporters, including tax breaks and subsidized credit.
- Improved logistics and supply chain efficiencies, reducing delivery times.
Imports from the US grew only marginally, led by machinery, petroleum products, and agricultural commodities. The trade deficit now stands at $2.5 billion, down from $2.8 billion in 2023.
Implications for the Economy
Economists view this development positively, as it helps stabilize Pakistan's external account. The narrowing deficit also supports the local currency and reduces pressure on foreign exchange reserves. However, they caution that sustained export growth requires continued investment in productivity and quality improvement.
