ISLAMABAD (ABC) — Pakistan’s exports of goods and services to China surged by 42.02% during the first eight months of the current fiscal year 2023-24 compared to the corresponding period of the previous year, the State Bank of Pakistan (SBP) has reported.
Year-on-year, the exports from Pakistan to China increased 20.60% from $140.166 million in February 2023 to $169.041 million in February 2024.
This noteworthy surge underscores the deepening trade ties between the two nations.
However, on a month-to-month basis, Pakistan’s exports to China declined 31.05% in February 2024, where exports amounted to $245.169 million.
Talking to WealthPK on condition of anonymity, an official of the industries & commerce section of the ministry of planning, development and special initiatives, said the surge in trade activity between Pakistan and China served as a testament to the deepening economic ties between the two nations.
“This notable uptick in trade volumes underscores a strengthening relationship propelled by a myriad of factors that fuel export growth.”
However, he cautioned that Pakistan’s exports remained low due to significant economic challenges and obstacles that demand innovative and strategic solutions.
“Export competitiveness is hampered by factors such as limited diversification, insufficient infrastructure, and low productivity.
Moreover, Pakistan’s export sector heavily relies on a narrow range of industries, notably textiles, which dominate the country’s export profile.”
He said the China-Pakistan Free Trade Agreement (CPFTA) presented opportunities for Pakistani exporters to bolster their shipments to the Chinese market.
The official said the industries and commerce section of the planning ministry had conducted a study to assess Pakistan’s exports to China and the rest of the world to identify potential export opportunities.
“The study analysed Pakistan’s exports to China in comparison to its exports to rest of the world, focusing on areas of potential growth.
It used Phase-II of CPFTA (2019-2024) and Pakistan’s Revealed Comparative Advantage (RCA) as key filters to pinpoint areas of opportunity.”
“Key observations of the study reveal that Pakistan exports $546 million worth of products to the world but not to China despite the existence of CPFTA and RCA.
These products have an aggregate market of $2.7 billion in China. China has a sizeable market of $45.6 billion for 71 items where there is CPFTA, but Pakistan does not export to China yet exports to rest of the world.
Further, Pakistan’ market penetration in China is only 0.7% in the product lines where Pakistan does not have RCA but has CPFTA,” the study shows.