Exports Fall by a Massive 47.24 percent in April 2020 - Android

Pakistan’s exports plummeted during April on the back of the coronavirus pandemic, which forced businesses to suspend their operations due to the low demand and disruption in supply chains.

Exports witnessed a massive decline of 47.24% in April 2020, with their value dropping from $1.81 billion in the previous month to $957 million, according to the Pakistan Bureau of Statistics.

Imports for April dropped to $3.08 billion, down by 6.88% as compared to $3.31 billion in March 2020. However, the trade deficit was widened by 42% month on month to $2.31 billion in April 2020 as compared to $1.50 billion in March 2020 due to the decline in exports.

Talking to ProPakistani, Dr. Aadil Nakhoda, an economist and Assistant Professor at IBA, Karachi, said that exports plunged 50% in terms of value, while the impact on imports is lower.

First things first, the lockdown in Pakistan seems to have an abrupt impact on exports as export orders and transactions seem to be severely disrupted. This shock is highlighted by the fact that several factories came to a grinding halt in March and April 2020.

Dr. Aadil said that this itself is a production shock rather than an export shock. On the other hand, the import side may not have been as impacted because retail sales of essential items (food, grocery) as well as oil seem to have continued even during the lockdown, he added.

The import adjustment had taken place much before the crisis when the govt tackled the Balance of Payment crisis. Therefore, the impact on it was relatively limited as imports of non-essential goods had already been curtailed to an extent.

It was also noted that exporters had to hold on to their consignments after receiving cancellation or deferment messages from their buyers.

On an annual basis, April’s exports were down by quite a margin, as Pakistan’s exports declined by almost 54.19% to $957 million as compared to $2.08 billion in April 2019. However, imports were also down by 34.50% to $3.088 billion as compared to $4.714 billion in 2019.

From July-April 2019-2020, Pakistan’s exports witnessed a decline of 3.92%, falling from $19.160 billion in July-April 2018-2019 to $18.408 billion in July-April 2019-2020. The imports witnessed a decline of 16.5% in the same period, from $45.393 billion in July-April 2018-19 to $37.905 during July-April 2019-20.