Pakistan’s merchandise exports experienced a notable decline of 5.61 percent, dropping to 27.91 billion dollars during the first eleven months of the fiscal year 2025-26. This contraction stands in comparison to the 29.56 billion dollars recorded during the exact same operational period of the preceding fiscal year. According to the latest official datasets released by the Pakistan Bureau of Statistics, the contraction in outbound shipments coupled with an escalating inward flow of goods caused the national trade deficit to widen by 17.48 percent, underscoring persistent pressure on the external trade account.
The data highlights that the country’s aggregated import bill rose by 5.94 percent, climbing to 62.66 billion dollars during the July-May period of the current fiscal cycle. This import expansion represents an upward shift from the 59.15 billion dollars recorded in the corresponding period of the previous fiscal year. As a direct consequence of these opposing trade trajectories, the net trade deficit expanded significantly to 34.76 billion dollars over the eleven-month duration, moving up from the 29.58 billion dollars documented in the same timeframe last year.
Despite the broader eleven-month contraction, the specific data for the month of May displayed a modest month-wise recovery pattern. Outbound shipment earnings managed a year-on-year recovery of 1.26 percent, touching 2.71 billion dollars compared to the 2.67 billion dollars recorded in May of the previous calendar year. On a month-on-month sequential basis, the overall export proceeds reflected an even sharper monthly improvement, posting a 9.59 percent expansion when compared directly to the immediate preceding month of April.
Simultaneously, the import trajectory for the single month of May pulled back significantly, providing temporary relief to the monthly balance of payments. Inbound shipments declined by 6.63 percent on a year-on-year basis, dropping to 5.28 billion dollars from the 5.66 billion dollars registered during the same month last year. Evaluated on a month-on-month basis, the import contraction was even more dramatic, plunging by 21.45 percent. This synchronized drop in monthly imports allowed the trade deficit for May to narrow by 13.68 percent, settling at 2.58 billion dollars instead of the 2.99 billion dollars logged a year earlier.
National export activities have remained under severe structural pressure throughout the vast majority of the current fiscal year. Following a temporary 16.43 percent year-on-year increase observed back in July, export growth turned sharply negative from August onward, showing brief exceptions only during January and April. Export proceeds fell by 12.49 percent in August, 3.88 percent in September, 4.46 percent in October, 14.54 percent in November, and a steep 20.41 percent in December. After a minor 3.3 percent rebound in January, proceeds slipped again by 8.76 percent in February and 14.4 percent in March, before staging a brief 14.03 percent recovery in April right before the minor increase seen in May.
Compounding internal industrial challenges, the exporting sectors have also faced intense geopolitical headwinds originating from the Middle East conflict since February. Ongoing regional disruptions concentrated around the critical Strait of Hormuz have drastically pushed up international maritime shipping costs, created equipment shortages, and delayed core supply chains. Trade analysts warned that a prolonged Gulf conflict will likely continue to suppress national export growth by physically disrupting maritime trade pathways, weakening consumer demand across key regional partner markets, and adding intense volatility to global logistics networks.
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