By Muhammad Mudassar ISLAMABAD, April 14 (INP-WealthPK): Pakistan’s exports surged by 24.7% and reached $23.298 billion during the first nine months (July-March) of the fiscal year 2021-22 as compared to the same period of the previous fiscal (2020-21) when the exports value was $18.687 billion, according to Pakistan Bureau of Statistics (PBS). Tahir Abbas, head of research at Arif Habib Limited, a securities brokerage, investment banking, and research firm, commentated that export growth was impressive in March, which would provide the much-needed relief to the country on the external front. On the other hand, imports grew by 48% to $58.7 billion during the reported period as compared to the corresponding period of FY 2020-21 ($39.5 billion). Pakistan has been struggling to cope with the external sector payment as high imports and external debt payments have put pressure on the foreign exchange reserves, which declined massively to $17.5 billion on a week-over-week basis, as per the latest data issued by the State Bank of Pakistan (SBP) on April 1, 2022. The widening trade deficit has resulted in an increase in the current account deficit because of the gap between imports and exports. Trade deficit has reached $35 billion during the first nine months of FY 2022, which is 70% more than $20.8 billion during the same period of FY 2020-21. Exports by Pakistan increased by 26% to $20.6 billion during the first eight months of FY 2021-22 as compared to the same period in FY 2020-21 ($16.1 billion). The major export goods that showed tremendous growth in value during the reported period are readymade garments which showed a 25.1% growth, bedwear 20.3%, cotton yarn 34.4%, cotton cloth 28.2%, knitwear 33.9%, chemical and pharma products 37.8%, leather manufactured products 10.5% and basmati rice 30.9%. A significant portion of the growth in overall exports is due to increased exports of value-added goods, which account for almost 40% of total exports. Pakistan's economy is likely to benefit from the surge in exports. Increasing exports ensured the stability of the economy. It is necessary, however, to reduce the volume of imports. The reason is that due to heavy imports, the trade deficit rises, which causes negative effects on the exchange rate, inflation, and interest rate. Imports and exports are largely affected by inflation and interest rates due to their influence on the exchange rate. As inflation increases, interest rates typically rise as well. The government should ban and discourage unnecessary imports. In order to reduce the import of products manufactured in Pakistan, the government should support local manufacturers and discourage imports through non-tariff barriers. Exports can be increased by simplifying the related regulations. Lengthy bureaucratic procedures are detrimental to new exporters. Moreover, governments should enhance the collection and dissemination of information regarding foreign markets and export requirements. Exports are adversely affected by protectionist tendencies that seek to encourage production for domestic markets rather than global markets. A paradigm shift is needed in order to provide incentives to industries to shift from producing low-value products to high-value products.