By Irfan Ahmed ISLAMABAD, May 11 (INP-WealthPK): Pakistan’s trade deficit has increased enormously, as imports are rising exponentially compared to exports , WealthPK reported. According to the Pakistan Bureau of Statistics (PBS), the country’s trade deficit widened by 64.79% to hit a record high of $39.264 billion in the last 10 months of the current fiscal year (2021-22). The country’s exports increased by 25.46% to $26.228 billion in the last 10 months of the current fiscal year as compared to $20.905 billion during the same period of 2020-21. Imports climbed by 46.41% during July-April, reaching $65.492 billion, up from $44.731 billion in the corresponding period of the previous year. [caption id="attachment_66762" align="aligncenter" width="696"] Source: PBS website/WealthPK research[/caption]   According to the PBS, the country’s trade deficit widened by 2.72% month-on-month (MoM) to $3.742 billion in April 2022, against $3.643 billion in March 2022. Imports increased by 2.96% in April 2022, to $6.615 billion from $6.425 billion in March 2022. Exports also increased by 3.27% in April 2022, to $2.873 billion from $2.782 billion in March 2022. [caption id="attachment_66761" align="aligncenter" width="696"] Source: PBS website/WealthPK research[/caption] On a year-on-year (YoY) basis, the trade deficit widened by 23.74% in April 2022, climbing to $3.742 billion, up from $3.024 billion in April 2021. This is because imports registered an increase of 26.19% on a YoY basis and jumped from $5.242 billion to $6.615 billion. The country’s exports witnessed an increase of 29.53% to $2.873 billion in April 2022 from $2.218 billion in the corresponding period last year. According to economic experts, the recent increase in crude oil prices and the resurgence of local demand are putting pressure on the trade balance, as the import bill is expected to stay high. While a trade deficit is not inherently bad or good, it can have different effects, depending on the economy in context. In Pakistan’s context, this will lead to increasingly higher costs of imported goods for consumers, while domestic workers also earn less due to a weakened rupee. Depreciation of the rupee can be welcome in the global economic context, but not over the longer term. To minimize the import bill, the government should restrict the import of cars and increase the Regulatory Duty (RDs) and Additional Customs Duty on certain luxury commodities. The real hard work for Pakistan is to upgrade the productivity of businesses as well as their innovative capacity. To reduce the trade deficit, the country's manufacturing capacity should be increased. More capacity for high-quality, low-cost production means more exports. A long-term strategy must be devised and implemented for enhancing industrial production that promotes competition and maximizes export opportunities. Pakistan’s economic growth is dependent on its exports which bring income from abroad. If the administration is serious about reducing trade deficit, then trade policy must be on top of the agenda and efforts must be made to increase exports.