Key Takeaways
- Pakistan’s trade deficit with nine neighbouring countries increased by 26.62% to $4.97 billion in Q1 FY27.
- Exports to Afghanistan and Bangladesh declined significantly, while imports from China surged.
- The bilateral deficit with China widened by $858.808 million, accounting for 82.18% of the increase.
Pakistan’s trade deficit with nine neighbouring countries widened by 26.62% to $4.97 billion in the first quarter of the fiscal year 2026-27, compared to $3.93 billion in the same period last year, according to the latest data compiled by the State Bank of Pakistan.
The increase in the trade deficit reflects a contraction in Pakistan’s exports to regional markets, particularly to Afghanistan and Bangladesh. Exports to Afghanistan, including exports, have remained suspended since October 10, 2025, further impacting overall export performance.
Imports from China rose sharply during the July-September quarter, contributing significantly to the widening imbalance. The bilateral deficit with China widened by $858.808 million, accounting for approximately 82.18% of the increase in the combined deficit with the nine countries.
Pakistan’s exports to China grew marginally, while exports to Nepal also increased in percentage terms, though the increase remained negligible in dollar value. In contrast, shipments to Afghanistan, Bangladesh, and Sri Lanka declined.
Exports to the nine countries—Afghanistan, China, Bangladesh, Sri Lanka, India, Iran, Nepal, Bhutan, and the Maldives—fell 6.72% to $944.24 million in July to September of FY27, down from $1.01 billion in the same period last year.
Imports surged 19.79% to $5.92 billion in 3MFY27 from $4.94 billion in the same months of the previous fiscal year. Further analysis showed that imports from China grew 19.76% to $5.82 billion in 3MFY27, up from $4.85 billion over the same period last year.
Pakistan’s exports to China grew 17.95% to $663.57 million in 3MFY27 from $562.56 million in the same months of the preceding fiscal year. Imports from India increased by 68.90% to $61.74 million in 3MFY27 from $36.55 million over the last year. Meanwhile, no exports to India were recorded in the first quarter of FY27.
Exports to Afghanistan fell 88.34% to $18.86 million in 3MFY27, down from $161.76 million last year. Imports stood at $0.25 million in 3MFY27, compared with $4.52 million in FY26, a decline of 94.40%.
Exports to Bangladesh declined by 2.96% to $174.77 million in 3MFY27 from $180.12 million over the last year. Imports dipped 36.11% to $13.88 million in 3MFY27 from $21.73 million over the last year.
