Irfan Ahmed

The services trade deficit of Pakistan has shrunk by a large margin during the first two months of the current fiscal, showing the effectiveness of the economic policies of the government, WealthPK reports.

According to the data released by the Pakistan Bureau of Statistics (PBS), the trade deficit of services in the first two months of the financial year 2022-23 was recorded at $608.70 million against $675.14 million in the corresponding period of the previous fiscal, registering a decrease of 9.84%.

The exports of services from Pakistan witnessed an increase of 8.25% and reached $1.130 billion in the first two months of the ongoing financial year as compared to $1.043 billion in the same period of the previous fiscal.

The import of services to the country also rose by 1.15% and reached $1.738 billion in the first two months of the current fiscal as compared to $1.719 billion in the same period of the previous financial year.

The Pakistan Software Board developed a comprehensive IT export strategic framework to promote IT exports. Different programmes and schemes are being implemented relating to infrastructure development, human capital development, company capability development, global marketing, strategy and research, and promotion of innovation and technologies for the purpose.

According to government projections, the export of merchandise will reach $35 billion and the export of services will reach $10 billion in the year 2022-23.

As per PBS data, the country’s services trade deficit widened by 45.64% on month-on-month basis and reached $360.90 million in August 2022 against $247.80 million in July 2022. On a month-on-month basis, the import of services also increased by 16.60% in August 2022 and reached $936.04 million from $802.80 million in July 2022.

The export of services also expanded by 3.63% in August 2022 and reached $575.14 million from $555.00 million in July 2022.

The overall export from Pakistan increased by 4% in August 2022 and reached $575.14 million, down from $553.00 million during August 2021. The sum of all imports shrunk by 0.54% and remained at $936.04 million in August 2022 as compared to $941.08 million during August 2021. The country’s total trade deficit narrowed by 7% to $360.90 million in August 2022 as compared to $388.08 million in the corresponding month of 2021.

The Standing Committee of the Senate on Commerce has recommended to the government give tax incentives to the IT industry and e-commerce sector, which have the potential to enhance the country’s exports.

IT-related services grew at the fastest rate ever, pushing up the overall export figure. The export of services also includes finance and insurance, transport and storage, wholesale and retail trade, public administration and defence sectors.

Both the government and SBP are aggressively promoting the rapidly expanding services sector, particularly by easing export revenues and providing tax breaks and incentives, in the current fiscal, according to the information gathered by WealthPK.

Credit : Independent News Pakistan-WealthPk