Pakistan’s trade deficit narrowed sharply by 19.7% month-on-month (MoM) to $3.17 billion in August 2026, compared with $3.95 billion in July 2026, as imports declined at a faster pace than exports, according to provisional data released by the Pakistan Bureau of Statistics (PBS).
Despite the monthly improvement, the external trade position remained under pressure on a year-on-year (YoY) basis, with the trade deficit widening by 10.4% YoY from $2.87 billion recorded in August 2025.
Imports Decline Faster Than Exports
Pakistan’s exports fell to $2.51 billion in August 2026, down 15.0% MoM from $2.95 billion in July. On a YoY basis, however, exports increased 3.8% from $2.42 billion in August 2025.
Imports declined more sharply during the month, falling 17.7% MoM to $5.68 billion, compared with $6.90 billion in July. Nevertheless, imports remained 7.4% higher YoY than the $5.29 billion recorded in August 2025.
The steeper monthly decline in imports relative to exports resulted in a $777 million reduction in the trade gap, bringing the monthly deficit down from $3.95 billion to $3.17 billion.
FY27 Trade Gap Widens 18.1%
Despite the improvement in August, Pakistan’s cumulative trade position during the first two months of FY27 deteriorated compared with the corresponding period last year.
Exports during July–August FY27 reached $5.46 billion, up 7.0% YoY from $5.10 billion in 2MFY26.
Meanwhile, cumulative imports increased at a significantly faster pace, rising 13.0% YoY to $12.58 billion, compared with $11.13 billion in the same period of FY26.
As a result, the cumulative trade deficit widened to $7.12 billion, an increase of 18.1% YoY from $6.03 billion in 2MFY26.
Outlook
The August data highlights a mixed picture for Pakistan’s external sector. While the sharp monthly decline in imports helped contain the trade deficit, the faster growth in cumulative imports relative to exports remains a key concern. With imports expanding by 13.0% during the first two months of FY27 versus 7.0% growth in exports, the widening cumulative trade gap could continue to place pressure on the country’s external account.
Source: Pakistan Bureau of Statistics (PBS)
