ISLAMABAD: The country’s oil import bill rose by 34.3 per cent year-on-year to $1.3 billion in the first month of this fiscal year whereas machinery buying from abroad registered a 22.7 decline to $0.78bn, showed data released by Pakistan Bureau of Statistics.

Barring petroleum products, almost all of the groups in imports table posted negative growth.

Consequently, total import bill during July 2018 saw a restrained rise of 0.6pc reaching $4.84bn from $4.80bn over the corresponding month last year.

The data for July suggests that the trade deficit, which has risen to alarming levels, might have already hit its peak since subsequent months have shown tepid growth. The newly elected government’s fortunes on external sector could see a marked improvement if the ongoing declining trend continues during the incumbent fiscal year.

Product wise data shows that petroleum group imports saw a robust growth of 34.3pc reaching $1.27bn in July as against $946.95m over the corresponding month last year, with largest surge coming from crude oil, which grew by 70pc. In terms of quantity, however, the increase was relatively modest at 4.46pc as 0.712 million tonnes of crude were imported, highlighting the fact that a large share of growth in oil import bill is mainly attributable to high crude prices.

Furthermore, bill for petroleum products imports dipped by 4.28pc during the first month of current fiscal year, whereas, the category recorded nearly 26.7pc decline in total quantity imported; bringing it down to 1.03m tonnes.

In addition to that, import bill for liquefied natural gas (LNG) was up 143.79pc during the month under review while that of petroleum gas liquefied grew by 4.96pc.

The data shows a changing trend in the overall imports, with machinery related imports registering a marginal decline, and oil imports – including LNG – bill increasing in large part due to the rise in global oil prices.

For number of years now, machinery imports have been a cause of major reason for the government since it has continuously fuelled trade deficit, but the imports in the group have declined during last few months.

For July 2018, machinery imports fell by 22.8pc to $786.52m from $1.01bn last year. The import of textile, and power generating machinery also shrank during the period.

But import of office and construction machinery posted a marginal growth in July 2018 from a year ago. Imports of telecom equipments fell by 8.44pc – excluding mobile phones which grew by 1.43pc.

Transport group, another important contributor to trade deficit, also receded during July 2018 after it posted a 29.53pc YoY decline. The month saw a dip in imports of all types of transport equipments including auto parts. However, rising against the wave, import of road motor vehicles imports went up by 8.75pc.

Food imports registered lowest growth rate, despite being the second largest group contributing to the total import tally. The import bill posted a negative growth of 12.16pc in July 2018 from a year ago.

The decline is mainly due to a massive drop in import of palm oil, which saw a dip of 4.72pc. The import of milk products dipped by 26.87pc, whereas those of soybean oil also reporting a 88.14pc decline during July.

The second-biggest component in the food group bill was tea imports, which saw an increase of 12.66pc and that of pulses going up by 7.99pc.

Furthermore, imports of ‘other’ food items dipped by 6.67pc during the month under review.

Published in Dawn, August 22nd, 2018