ISLAMABAD, Pakistan – Web Desk: The government has failed to achieve its annual export target for the fiscal year 2025-26, falling short by $5.2 billion as exports declined to $30.1 billion. The widening trade deficit has once again exposed fundamental weaknesses in Pakistan’s economy.
According to data released by the Pakistan Bureau of Statistics (PBS), exports declined by 6 percent to $30.126 billion during the fiscal year, missing the government’s target of $35.3 billion set under the National Economic Transformation Plan 2024-29 . Meanwhile, imports surged by 7.89 percent to $69.597 billion, driven largely by duty relaxations in the budget and higher petroleum prices following tensions in the Middle East .
The annual trade deficit expanded by $7 billion to $39.47 billion, marking a 21.57 percent increase compared to the previous fiscal year . The shortfall comes despite the Planning Commission’s recommendation last month to link economic incentives to productivity and export performance rather than protectionism and rent-seeking . However, the government continued with broad-based export subsidies instead .
June 2026 proved particularly challenging, with exports falling 9.6 percent year-on-year to $2.239 billion, while imports rose 26.3 percent to $6.767 billion. As a result, the monthly trade deficit widened 57 percent to $4.5 billion — an increase of $1.6 billion in absolute terms .
For the new fiscal year 2026-27, the government has set an export target of just $32.8 billion — only 8.5 percent higher than actual exports of $30.1 billion . Imports are projected to exceed $70 billion, with the trade deficit target set at $37 billion, expected to be largely financed by remittances from overseas Pakistanis .
Exporters argue that the Pakistani rupee remains approximately 5 percent overvalued against its real value, undermining their global competitiveness and forcing greater reliance on the domestic market . The rupee was trading at approximately 278.15 against the US dollar on Thursday.
The government also missed the IMF-linked tax collection target for FY2025-26 by Rs975 billion ($3.5 billion) . Planning Minister Ahsan Iqbal recently emphasized that Pakistan will not be able to move beyond reliance on the International Monetary Fund until exports rise to sustainable levels .
