Raza Khan

Pakistan’s services exports were recorded at $538 million during the first month of the current fiscal year (2023-24) compared to $526 million during the same month of last fiscal year, according to the Ministry of Commerce. An increase of 2.28% was registered in the country’s services exports during the month under review. Pakistan’s IT sector leads the country’s services exports with a revenue of $214 million in July 2023, registering a 7.53% increase from the same month of the previous fiscal year. Business services exports were registered at $110 million during the first month of FY24 compared to $119 million during the same month of last year, with a decline of 7.56%. With a marginal increase of 5.63%, exports of transport services rose to $75 million during July FY24 from $71 million during July FY23. Exports of government goods and services remained at $75 million during the period under review without any significant change.

Source: Ministry of Commerce

The travel sector’s exports fell by 21% to $45 million in July 2023, compared to $57 million in the same month of the previous year. Exports of financial services, insurance and pension services and the construction sector were recorded at $8 million, $2 million and $1 million, respectively. On the other hand, the country’s imports of services rose to $811 million during the month under review compared to $558 million during the same month of last year, with an increase of 45.34%. Imports of the transport sector were recorded at $355 million during July FY24 against $348 million during the corresponding month of FY23, registering a growth of 2%. Travel services imports dropped by 58% to $65 million during the month under review from $155 million during the same period of last year. According to the State Bank of Pakistan (SBP) data, Pakistan missed the target of services exports by 27% during the fiscal year 2022-23. Pakistan’s services exports were registered at $7.302 billion during FY23 compared to $7.102 billion during FY22, with a slight growth of 2.81%.

The government had set the services exports target at $10 billion for FY23, which could not be achieved. According to data, the IT sector led services exports during FY23 with an export volume of $2.593 billion against $2.619 billion during FY22. Tufail Ahmed Khan, Chief Executive Officer (CEO) of Pakistan Freelancers Association (PAFLA), said the IT sector failed to achieve any significant growth in its exports during the last fiscal year. He was of the view that the government is relying too much on IT exports, while other services sectors are being overlooked. “The government should also focus on travel, transport, insurance, financial services and intellectual property sectors,” he said. He called upon the government to bring policy reforms to boost services exports, especially the IT exports. He added that a large number of freelancers are not bringing back their money from abroad due to complex banking transfers and taxation.

Credit: INP-WealthPk