Pakistan’s goods trade deficit expanded by 17.48% to $34.758 billion during the first eleven months of FY26, reflecting continued pressure on the country’s external sector as exports declined while imports increased, according to official data released by the Pakistan Bureau of Statistics.

The data shows imports rose 5.94% to $62.66 billion during July–May, driven by demand for foreign goods and raw materials, while exports fell 5.6% to $27.9 billion compared to $29.56 billion in the same period last year. This widening gap underscores Pakistan’s ongoing dependence on imported inputs for industrial and consumer needs.

On a monthly basis, however, there were signs of partial stabilisation. In May 2026, the trade deficit narrowed by 13.7% year-on-year to $2.58 billion. Exports increased slightly by 1.26% to $2.71 billion, while imports declined 6.6% to $5.287 billion, indicating a possible moderation in domestic demand.

The services sector provided some offsetting relief. The services trade deficit contracted by 17.4% to $2.04 billion during July–April FY26, as services exports rose sharply by 17.7% to $8.3 billion, outpacing an 8.6% rise in imports.

In April alone, the services deficit narrowed significantly to $26.1 million from $163 million a year earlier, supported by a 21.7% increase in exports to $915 million and a 2.8% decline in imports.

Economists note that Pakistan’s IT and business services sector remains one of the few consistent areas of export growth, but its scale is still insufficient to offset the broader structural imbalance in merchandise trade.