Pakistan’s import costs for oil and food rose to $ 24.77 billion

Pakistan's import costs for oil and food rose to $ 24.77 billion

In the July-March period, Pakistan’s oil and food import expenses increased by 59.98% to USD 21.87 billion, despite the country’s decreasing economy. Due to higher international costs and a substantial devaluation of the Pakistani Rupee, the import bill increased to USD 13.67 billion in the same period last year. In the nine months ending September 2021 (9MFY22), the country’s overall import bill increased by 49.10 percent to USD 58.87 billion, up from USD 39.48 billion the previous year. In 9MFY22, the share of these products in the total import bill increased to 37.14 percent. The import cost for oil jumped by almost 96.09 percent to USD14.81 billion in 9MFY22 from USD 7.55 billion, according to Pakistan Bureau of Statistics statistics.

The rising food imports and the consequent trade deficit are yet another thing that is the main tension for the government. Pakistan spent over USD 8 billion on the import of edible items in the last fiscal year. According to the publication, the import bill will go up further in the coming months as the government decided to import 0.6m tonnes of sugar and 4m tonnes of wheat to build strategic reserves. Due to rising world prices, especially after the Russia-Ukraine crisis, the palm oil import bill grew by 46.74 per cent in value in 9MFY22 to USD 2.73 billion from USD 1.86 billion in 9MFY21. The prices of vegetable ghee and cooking oil also went up. On one hand, the prices of food items are increasing while on other hand the number of imports of products is fluctuating, reported Dawn newspaper.

The steady increase in import bills of these two sectors is triggering a trade deficit in the country and also poses a threat of creating pressure on the external side of the government. Not only oil, but the Crude oil imports rose by 82.25 per cent in value and 3.50 per cent in quantity during the period under review while those of liquefied natural gas increased by 91.78 per cent in value. Liquefied petroleum gas imports also rose by 46.32pc in value in 9MFY22. The food import bill rose by over 15.46pc to USD 7.06bn in 9MFY22 from USD 6.12bn over the corresponding period last year to bridge the gap in food production.

The import of soyabean oil hiked by 113.7 per cent in value and 6.98 per cent in quantity in 9MFY22 from a year ago. However, the wheat imports fell by 38.91 per cent to 2.206m tonnes in 9MFY22 against 3.61 million tonnes in 9MFY21.  The import of sugar also rose. It rose by 11.24pc to 311,031 tonnes in 9MFY22 against 279,604 tonnes in 9MFY21. The import bill of pulses, tea, and spices also grew rapidly during the period under review.

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