Since June 2017, exports have continued to rise. During February 2018, exports have achieved the highest monthly growth yet in the fiscal year, by posting 16% increase in dollar terms and 22% increase in rupee terms, in comparison to the exports in February 2017.
This has been claimed by the Ministry of Commerce here on Friday.
The current year’s export performance has already contributed additional forex inflows of around USD 1.5 billion during the first eight months and is expected to reach the figure of additional USD 2.5 billion, during 2017-18. This increase in economic activity in the external sector reflects an increase of 0.8% of GDP. This means an additional Rs. 280 billion in incomes to trade, industry, agricultural sectors, helping to create more jobs for the public in the process.
These results, sources say, have been achieved due to the export-friendly policies and incentives of the government and the renewed efforts towards seeking better market access by the Ministry of Commerce. The positive trend in the international demand and exchange rate correction are also expected to help sustain this rising trend in the coming months.
Imports have also responded to the steps taken to check the surge in consumer goods inflows since the past few years. The imposition of Regulatory Duties on 355 non-essential consumer items by ECC on the proposal by Ministry of Commerce resulted in reduction in the imports of these goods by 16%, while the FBR revenue registered an increase.
However, since a large chunk of imports comprise of essential goods such as fuels and edible oil, which has been affected by the rising trend since July 2017, the impact of reduced imports of non-essentials, is being offset. The imports of machinery and raw materials, essential for economic growth, also contribute to the gap in the balance of trade.
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However, despite all these pressures, the increase in imports has been only 9.7% during February 2018 as compared to February 2017, bringing down the trade deficit by 21% from USD -3636m in Jan 2018 to USD -2895m in February 2018.
