Pakistan’s trade deficit with six major Gulf countries fell by nearly half in July as lower energy imports reduced the country’s overall import bill.
The combined trade deficit with Saudi Arabia, the UAE, Kuwait, Bahrain, Qatar and Oman dropped 46.5% year-on-year to $750.5 million, compared with around $1.4 billion a year earlier, according to State Bank of Pakistan data.
Pakistan’s imports from these six countries declined 38.1% to $1.04 billion during the month. In contrast, exports increased 4.7% to $290.3 million.
The sharp fall in imports was mainly linked to lower purchases of petroleum products as local refineries increased production. Pakistan also imported no high-speed diesel in July, while petrol imports declined.
Shankar Talreja, Head of Research at Topline Securities, attributed the change to several factors, including disruptions around the Strait of Hormuz and higher production by domestic refineries.
Pakistan relies heavily on Gulf countries for crude oil, petroleum products and LNG, making its energy import bill vulnerable to supply disruptions in the region.
Trade with Qatar recorded one of the biggest declines. Pakistan’s imports from Qatar fell 78% year-on-year to $61.5 million in July, while exports dropped 16% to $7.42 million, according to SBP data.
Imports from Oman moved in the opposite direction, rising 58% to $161 million. However, Pakistan’s exports to Oman declined 11.3% to $20.5 million.
Separately, Pakistan imported $1.28 billion worth of petroleum products, including crude oil, LNG and LPG, in July. The amount was 5.2% lower than the same month last year, according to Pakistan Bureau of Statistics data.
