ISLAMABAD – Pakistan’s trade deficit widened by 15 percent year-on-year to $10.8 billion during the first quarter of fiscal year 2026-27, as imports increased faster than exports, according to data compiled by Topline Securities.
The trade gap stood at $9.37 billion during the same period last year. Meanwhile, Pakistan’s external trade remained under pressure in September, when the monthly deficit reached around $3.6 billion.
Official data from the Pakistan Bureau of Statistics (PBS) tracks the country’s imports, exports and balance of trade on a monthly, quarterly and annual basis.
Pakistan Trade Deficit Widens as Imports Outpace Exports
During July-September 2026, Pakistan’s imports increased by 13 percent year-on-year to $19.2 billion.
Exports also grew during the quarter, rising 11 percent to $8.4 billion from $7.6 billion a year earlier.
However, the increase in exports was not enough to offset the larger rise in imports.
Imports added approximately $2.2 billion during the quarter. By comparison, exports increased by around $824 million.
| Indicator |
1QFY26 |
1QFY27 |
Change |
| Imports |
$17.0bn |
$19.2bn |
+13% |
| Exports |
$7.6bn |
$8.4bn |
+11% |
| Trade deficit |
$9.37bn |
$10.8bn |
+15% |
The figures show that stronger export receipts were accompanied by an even larger increase in the import bill, resulting in a wider overall trade gap.
September Trade Deficit Reaches $3.6 Billion
The pressure became particularly visible in September.
Pakistan recorded a monthly trade deficit of approximately $3.56 billion during the month, up 6 percent from $3.35 billion in September 2025 and 8 percent from around $3.29 billion in August 2026.
Imports rose to $6.5 billion in September, increasing 11 percent year-on-year and 12 percent compared with August.
Exports also posted significant growth. They rose 18 percent year-on-year and 16 percent month-on-month to $2.9 billion.
Even so, the stronger export performance was outweighed by the larger increase in imports.
Pakistan’s Monthly Trade Gap Remains Elevated
The Pakistan trade deficit has remained relatively high since the beginning of FY2026-27.
The monthly gap stood at around $3.8 billion in July before narrowing to approximately $3.3 billion in August. It then widened again to about $3.6 billion in September.
The pattern indicates that the country entered the new fiscal year with a sizeable goods trade gap, despite continued growth in exports.
Pakistan’s trade figures can fluctuate significantly from month to month because of changes in import demand, global commodity prices, energy costs and export shipments.
Exports Are Growing but Imports Are Rising Faster
The latest figures present a mixed picture for Pakistan’s external trade.
On one hand, exports have continued to expand. The government said goods exports reached $5.4 billion during July-August FY2026-27, while exports of goods and services combined reached $7.3 billion, up 9.2 percent from $6.6 billion a year earlier.
On the other hand, merchandise imports have grown at a faster pace.
Data for the first two months of FY2026-27 showed imports rising 13.03 percent to $12.575 billion, while exports increased 7.04 percent to $5.46 billion. As a result, the trade deficit for July-August was reported at $7.116 billion, compared with $6.025 billion a year earlier.
The September figures therefore extend a trend already visible during the first two months of the fiscal year.
What the Wider Trade Gap Means for Pakistan
A wider goods trade deficit means Pakistan is spending more on imported goods than it earns from merchandise exports.
That does not automatically translate into a deterioration in the overall external account because services exports, remittances and other components also affect the balance of payments.
In fact, Pakistan’s current account deficit during July-August FY2026-27 was reported at $543 million, down 36 percent from $853 million a year earlier. Remittances also increased to $7.3 billion during the first two months from $6.4 billion in the corresponding period.
Therefore, the Pakistan trade deficit should be viewed alongside the wider external account rather than as a standalone measure of the country’s external position.
What to Watch in the Coming Months
The direction of imports and exports will remain important for Pakistan’s external financing position during FY2026-27.
Higher imports can support economic activity when they involve machinery, raw materials and other productive inputs. However, a sustained increase in the import bill can also widen the goods trade gap if exports do not grow at a comparable pace.
Meanwhile, stronger export growth could help narrow the gap over time, particularly if Pakistan continues expanding higher-value goods and services exports.
The government has highlighted ICT and digital services as increasingly important sources of foreign exchange. According to the Planning Ministry, ICT exports reached $811 million during July-August FY2026-27, compared with $691 million during the same period last year.
For now, September’s figures show that Pakistan’s trade deficit remains elevated, with imports continuing to grow faster in absolute terms than exports.
Key Points :
- Pakistan’s trade deficit widened 15 percent year-on-year to $10.8 billion in 1QFY27.
- Imports increased 13 percent to $19.2 billion.
- Exports rose 11 percent to $8.4 billion.
- September’s monthly trade gap reached approximately $3.56 billion.
- September imports stood at $6.5 billion, while exports reached $2.9 billion.
- The monthly deficit widened from August’s $3.29 billion.
- Stronger exports have not yet offset the faster growth in imports.
- Pakistan’s current account position also depends on services, remittances and other external flows, which can differ from the goods trade balance.
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