The effects of the ongoing conflict in the Middle East have begun to reach Pakistan, with the country’s trade deficit widening markedly during the current financial year.
During the first nine months of the fiscal year, the trade deficit increased by more than $5 billion, rising to approximately $28 billion.
Tensions in the Middle East and the closure of key trade routes have started to weigh on Pakistan’s economy. From July to March, the deficit rose by nearly 23 per cent compared with the same period last year, when it stood at $22.67 billion.
According to the Federal Bureau of Statistics, Pakistani exports declined by more than eight per cent, or nearly two billion dollars, falling from $24.71 billion to $22.73 billion during the period under review.
Imports, meanwhile, recorded an increase of 6.64 per cent, with the total volume exceeding $50 billion. Several sectors, including textiles, rice, fruits and vegetables, have been affected.
In March 2026, exports fell by 14.40 per cent on a year-on-year basis, declining from $2.64 billion to $2.26 billion. On a monthly basis, exports edged down by 0.55 per cent compared with February.
Imports during the same month declined by 5.57 per cent year-on-year, falling from $5.27 billion to $4.99 billion. On a monthly basis, the drop in imports led to a 9.36 per cent reduction in the trade deficit.
There remains concern that a prolonged conflict in the Middle East may further disrupt trade activity.
