Moaaz Manzoor

Pakistan’s external trade posted encouraging growth in September 2025, as both exports and imports registered month-on-month gains, reflecting a gradual recovery in global demand and domestic industrial activity. According to the Ministry of Commerce, exports in September 2025 stood at $2.5 billion, up from $2.4 billion in August, representing a 3.48% increase. In rupee terms, exports rose 3.04% to Rs703 billion from Rs683 billion a month earlier.

On a year-on-year basis, however, exports declined 11.85% from $2.8 billion as recorded in September 2024. The quarterly comparison indicates a mild contraction, as exports during July-September 2025-26 stood at $7.6 billion, down 3.88% from $7.9 billion in the same period last year. In rupee terms, exports over the quarter totalled Rs2,149 billion, 2.32% lower than Rs2,200 billion in the corresponding period of FY25.

Imports, meanwhile, recorded a notable rise, reflecting increased energy and machinery inflows tied to the ongoing recovery in industrial and infrastructure activity. Total imports during September 2025 reached $5.9 billion, up 11.63% from $5.3 billion in August. In rupee terms, imports climbed 11.33%, amounting to Rs1,664 billion from Rs1,495 billion a month earlier. When compared with September 2024, imports were up 15.16% in dollar terms and 16.49% in rupees, signalling renewed import demand amid higher commodity prices and improving supply chains.

Cumulatively, imports during the first quarter of FY26 stood at $17 billion, an increase of 13.88% from $14.9 billion in the same period last year. In rupee terms, imports grew 15.57% year-on-year to Rs4,818 billion from Rs4,169 billion. Consequently, the country’s trade deficit widened in September but remained within a manageable range. The trade gap expanded to $3.4 billion in September 2025, compared to $2.8 billion in August, an 18.49% increase month-on-month. In rupee terms, the deficit rose 18.30% to Rs960 billion from Rs812 billion.

On a yearly basis, the deficit widened 48.58% in dollar terms and 50.16% in rupees, compared to September 2024. For the July-September quarter, the trade deficit stood at $9.4 billion, showing a 33.80% increase from $7.0billion in the same quarter last year. In rupees, the gap was Rs2,668 billion, up 35.57% from Rs1,968 billion recorded in July-September 2024-25. Officials said the recent pickup in exports, despite global headwinds and a stable exchange rate, signals resilience in Pakistan’s external sector.

They noted that import growth, driven by petroleum and machinery inflows, points to improving domestic demand and early signs of economic reactivation. “The narrowing quarterly export contraction and higher import volumes suggest normalisation in trade flows and improving industrial sentiment,” observed the official.

Despite the widening deficit, the overall increase in trade activity reflects renewed momentum in the external sector. The export-to-import ratio, which stood at 42.3% in September 2025 compared to 45.7% in August 2025, indicates room for improvement but underlines steady export engagement as the fiscal year progresses.

Credit: INP-WealthPk