Written by Marijn Overvest | Reviewed by Sjoerd Goedhart | Fact Checked by Ruud Emonds | Our editorial policy

10. Pakistan to Explore Export Opportunities in the SAARC and ASEAN Regions

Pakistan’s total exports to South Asia accounted for around 10.5% of its total exports where Afghanistan leads as the top exporter which accounts for 4.97%. Moreover, the country is the only South Asian country that belongs to three significant organizations: the SAARC, ECO, and SCO, so Pakistan is most likely well-positioned to contribute to inter-regional connectivity.

Moreover, Pakistan seeks to diversify its export destinations to Bangladesh, Bhutan, Maldives, India, Nepal, and Sri Lanka.

11. Pakistan’s Commitment to Cleaner Coal Combustion Technologies Halts Amidst Economic Crisis

Although Pakistan has recently committed to cleaner coal combustion technologies by importing 40% environment-friendly motors like electric-powered vehicles and home rooftop solar energy solutions, it takes a pause amidst the country’s economic crisis.

According to the recent budget document for the second half of 2023 and the first half of 2024, the customs duty on the import of hybrid-electric vehicles is reduced to 1% from 10% which means that there will be fewer EVs to be brought in the country.

12. Pakistan Aims to Expand Cultivated Land of Fruits and Vegetables to 15% by The End of 2023

The Pakistan Business Council reports that in order to maintain agricultural growth, Pakistan seeks to expand cultivated land of fruits and vegetables from 5% to 15% to save water and to achieve greater growth in agriculture.

This improvement can drive investments into cold chain infrastructure and attract global plates to trade.

13. Pakistan’s IT Exports Surged by 24% ($236 Million) in May 2023

The Express Tribune reports that Pakistan’s information technology (IT) exports experienced a remarkable surge of 24% in May 2023 which reached a total amount of $236 million.

Moreover, according to Tribune, the overall technology exports in the same month has had a significant year-on-year increase of 28% which accounts for the highest monthly export figure since December of the previous year.

14.  Pakistan is The 6th Largest Producer and Exporter of Cotton in The World

Better Cotton is an organization that helps cotton farmers in different countries deal with the effects of climate change and create sustainable livelihoods and job opportunities. Moreover, based on BC’s findings, Pakistan is the sixth largest producer of cotton in the world and also has the 3rd largest cotton spinning capacity in Asia after China and India.

Through this, the country is able to supply thousands of spinning units that produce textile products made of cotton. Moreover, recent 2023 records show that there is about 682, 000 tonnes and about 1, 032, 000 hectares of cotton Better Cotton has harvested.

15. Current Rice Exports First Half of 2023 Earn Pakistan $2.1 Billion

According to Dawn News, in spite of Pakistan’s significant losses and economic challenges, the country was able to export 3.717 million tonnes of rice and earned $2.149 billion in the first half of 2023. Moreover, export of basmati varieties of rice topped at 595, 120 tonnes which garnered around $650, 423 at an average per tonne rate of $1, 092.

16. Japan-Pakistan Relations in 2023

Currently, Pakistan’s total exports to Japan reached $223 million with top products like cotton, textile goods, and chemical products). In addition, the country’s imports from Japan reached $1.69 billion that includes products like automobiles, machinery, and steel.

Moreover, latest data from MOFA shows that Japan’s direct investment to Pakistan reached $182 million in June 2023.

17. Fiscal Reforms Seen as Key for Economic Stability and Sustainable Growth in Pakistan

Pakistan’s economy slowed sharply in the first two quarters of 2023 with real GDP estimated by 0.6%. According to the World Bank’s latest Pakistan Development Update: Restoring Fiscal Sustainability, released on October 3, the decline in economic activity reflects the cumulation of domestic and external shocks including the government restrictions on imports and capital flows, domestic political disputes, surging world commodity prices, and tighter global financing.

Additionally, the poverty headcount is estimated to have reached 39.4% with 12.5 million more Pakistanis falling below the Lower-Middle Income Country poverty threshold (US$3.65/day)

Furthermore, without a definite fiscal adjustment and decisive implementation of broad-based reforms, Pakistan’s economy will remain vulnerable to local and international instabilities.

18. Pakistan’s Trade Deficit Minimized by 47% During 2023 Fiscal Year

Pakistan has reduced its trade deficit by 43% to $27.55 billion in fiscal year 2023, while, on the other hand, imports decreased by 31% to $55.29 billion, according to the Pakistan Bureau of Statistics.

The Pakistani government also took control over imports and it was significant enough in stabilizing the country’s critically low foreign exchange reserves and mitigating the risks of default. Government procurement in Pakistan is significant in this situation.

Agriculture and Global Warming

The widespread flooding in Pakistan not only killed 1,739 people but largely damaged the country’s agriculture, reducing its food supply and export capacity. 

The country is a net food exporter and the severe flooding, and hot and dry temperatures badly hurt its rice and cotton industry, Pakistan’s top-produced crops. Sind, the no. 2 rice-growing provinces after Punjab lost 1.9 million tons of rice, an estimated 80% of the region’s total production. 

Furthermore, Pakistan lost 40% of its annual cotton production due to flash floods and landslides. Additionally, the sugarcane industry suffered 61% of its expected production and 42, 273 livestock were killed. This includes sheep, goats, buffalo, camels, cows, and donkeys. 

The Asian Development Bank (ADB), the European Union (EU), and the United Nations agencies conducted the Post-Disaster Needs Assessment (PDNA) and estimated the country’s economic loss of over $30 billion which needs $16.3 billion reconstruction and rehabilitation. 

Overall, this major economic loss in the country will take years to recover while the Pakistani people need to brace for long-term impact. 

Inflation Rate

The Pakistan Bureau of Statistics reported that the country’s consumer price inflation bounced to 31.5% in February 2023. The country’s highest rate in a decade. 

Additionally, the government increases its sales tax on some items by 25% decreasing the purchasing of Pakistanis especially the lower-middle-class and lower-class who lost 30% of their purchasing power. 

Furthermore, the unemployment rate increases from 6.3% to 9.1% due to business closure. This further heightens the annoyance and intolerance of the citizens living in unpleasant situations. 

The country’s projected slow 0.6% gross domestic product ( GDP ) growth in 2023 and its further decrease will plunge Pakistan into an economic depression if not mitigated immediately. Thus, the country needs a robust economic plan that capitalizes on its import and export sector to drive its economic development. 

Conclusion

Pakistan confronts formidable economic challenges due to devastating floods, extreme weather, and surging inflation, as reflected in a 10% decline in exports and a 25% drop in imports, resulting in a substantial 35.5% trade deficit for 2023.

Noteworthy trends include Pakistan being the 25th largest agricultural export market for the US, experiencing a $7.15 billion export loss in Q1 2023, and having foreign exchange reserves covering only two weeks of imports. Key export products include house linens, rice, and non-knit suits, while refined petroleum, petroleum gas, and crude petroleum dominate imports.

Efforts such as the commitment to renewable energy and exploration of export opportunities in SAARC and ASEAN regions underscore resilience amid adversity. It’s always admirable to keep in mind the pillars of sustainability even in the face of hardship. However, fiscal reforms are deemed crucial for economic stability and sustainable growth.

Despite a 47% reduction in the trade deficit during the 2023 fiscal year, widespread flooding severely impacts agriculture, resulting in an economic loss requiring extensive reconstruction.

The alarming 31.5% consumer price inflation in February 2023 and a rising unemployment rate compound challenges, emphasizing the urgent need for a robust economic plan to mitigate the risk of economic depression in Pakistan.