Exports continue to show upward trend
Exports from Pakistan continue to show an upward trend as they increased 14.37% in March 2021 over the value reported in February 2021 and 30% over the value reported in March 2020, as reported by the Pakistan Bureau of Statistics (PBS).
Export growth was reported across all major categories. Exports of the food group increased 16.5% month-onmonth in March 2021. This was dominated by exports of Basmati rice, which increased 73% month-on-month. Similar growth rates were also reported for fish and fish preparations.
Textile group exports increased 9.85%, dominated by the increase in exports of cotton cloth and bed wear, both growing more than 15% monthon-month. Other manufacturing groups reported an increase of 40.7% monthon-month, with almost 100% increase in exports of chemicals and pharmaceutical products. Exports of other chemicals increased 257% month-onmonth in March 2021.
All the aforementioned products showed at least $50 million worth of exports in March 2021. On the other hand, imports were valued at $5.67 billion in March 2021, up 23.02% monthon-month and 71.13% year-on-year.
All major product categories listed in the data provided by the State Bank of Pakistan (SBP) showed an increase in import value in March 2021 over the value reported in February 2021.
Given that Pakistan was hit by the first wave of the pandemic in March 2020, which resulted in a nationwide lockdown and a collapse in trade value, there will be a sharp increase in the year-on-year growth for several products. However, the sharp rise of $1 billion in imports in March 2021 over February 2021 needs further scrutiny.
Within the food group, imports of palm oil increased 26.7% month-onmonth as they surpassed $275 million.
Within the machinery group, imports of mobile phones increased 27.7% month-on-month. Although the increase in import figures is attributed to the regularisation of mobile phones under DIRBS, the continuous month-on-month increase suggests that there is more to this trend. It is likely that increased need for digitalisation during the pandemic and the soaring growth of exports in the IT sector, as reported earlier, may be a contributing factor in this trend.
There was a resurgent demand for imports of motor vehicles as both completely built-up units and knocked down units showed month-on-month growth rates of 30%. There was also an increase in imports of parts and accessories. Imports of the textile group increased 12% month-on-month with imports of raw cotton as well as synthetic fibre also growing. Imports of petroleum products increased 66% in value and 50% in quantity. Furthermore, imports of iron and steel were up 67%.
The quantum index of large-scale manufacturing (LSM) industries between July 2020 and February 2021 recorded year-on-year growth rates for food and beverages, pharmaceuticals, chemicals, non-metallic and automobile industries.
Several of these industries have recovered from stagnant growth. The increase in imports is likely to be driven by the growth in LSM, which indicates an increase in consumer demand. Exchange rate
There was approximately 4% gain in the rupee-dollar exchange rate in the first quarter of 2021. According to market-to-market revaluation of PKR to USD, the former gained approximately Rs6 to the dollar. The SBP reported a 20% surge in the monthly growth rate of export receipts as the receipts crossed $2.6 billion in March 2021. This was the highest reported value since June 2011.