Reporting snapshot · 7 November 2026 (Asia/Karachi). The October figures are provisional monthly trade data and can be revised. The services breakdown for October has not yet been published, so the four-month goods deficit is the firmest comparison available.
What the data show
Pakistan’s merchandise trade deficit widened 19.7 per cent year on year to $3.88 billion in October 2026, as imports rose more than four times as fast as exports, according to the Pakistan Bureau of Statistics’ monthly foreign trade summary. The bureau released the figures on 6 November; The News and The Express Tribune reported the breakdown on 7 November.
Exports in October were $2.93 billion, up 2.8 per cent from $2.85 billion a year earlier. Imports were $6.81 billion, up 11.8 per cent from $6.1 billion. The monthly gap therefore rose from $3.24 billion to $3.877 billion. The bureau’s summary rounds the total to $3.88 billion; the newspapers use the same underlying figures with slightly different rounding.
The four-month picture is similar. Between July and October, the first four months of fiscal year 2026-27, exports rose 8.5 per cent to $11.34 billion while imports climbed 12.6 per cent to $25.96 billion. The cumulative deficit widened 15.97 per cent to $14.63 billion from $12.6 billion a year earlier. The release extends the first-quarter picture, when the July-September gap was $10.79 billion; October alone accounted for the rest of the four-month total.
Those numbers extend a deterioration recorded in the previous fiscal year. In 2025-26, the merchandise deficit rose 21.6 per cent to $39.47 billion as exports fell 6 per cent to $30.13 billion and imports rose 7.9 per cent to $69.6 billion, according to the bureau data cited by The News.
Why the gap is widening
The arithmetic is straightforward: imports are growing faster than exports from a much larger base. The Express Tribune reported that imports averaged about $6.5 billion a month in July-October while exports averaged about $2.8 billion. October was close to that pattern, with imports of $6.81 billion against exports of $2.93 billion.
The composition matters as much as the total. The Express Tribune reported that the State Bank of Pakistan has projected imports rising to $71 billion this fiscal year on the back of higher energy import bills. The trade data do not separate volume from price, so the October increase cannot be attributed to any single factor from the headline figures alone.
On the export side, the government has set a goods export target of $34 billion for this fiscal year, against $30.8 billion last year, and a longer-term target of $60 billion by 2029. The Express Tribune reported that the budget retains about Rs88 billion in subsidies for cheaper export loans, mostly for large exporters, and that a depreciation of about Rs100 against the dollar had not produced a major export surge. The newspaper also reported that the National Assembly Standing Committee on Finance discussed the effect of closing three international borders for security reasons; the minister of state for finance acknowledged an impact but said the Afghan border had been shut on security grounds.
The government’s answer has been institutional as well as fiscal. On 6 November, Prime Minister Shehbaz Sharif approved a restructuring of the Trade Development Authority of Pakistan, capping its mandate at eight core functions and requiring a performance audit, as KhabarWire reported. Whether the changes affect export volumes will not be visible in the trade data for several quarters.
What it means for external financing
A goods trade deficit is not the same as the current-account deficit. Remittances, services exports and other flows can offset part of the gap, and the current-account data for October have not yet been published. The services trade figures that are available show why the distinction matters, and also why the overall external picture remains tight.
In September, Pakistan’s services trade deficit widened 84.3 per cent year on year to $282.7 million, as services exports rose 15.35 per cent to $930 million and imports rose 26.4 per cent to $1.21 billion, according to the bureau data cited by The News. For July-September, the services deficit was almost flat at $832 million, with exports up 22.6 per cent to $2.7 billion and imports up 16.3 per cent to $3.55 billion.
The goods gap still shapes the financing conversation. The Express Tribune reported that the trade deficit may keep Islamabad dependent on foreign creditors longer than planned. Finance Secretary Imdadullah Bosal told a parliamentary committee that external debt repayments were estimated at $21.5 billion this fiscal year, of which the government would seek $10.5 billion in rollovers of bilateral and commercial debt. Saudi Arabia extended a $3 billion deposit rollover last month.
The stock of external debt is a separate measure, and KhabarWire’s report on the World Bank’s latest International Debt Report sets out the creditor mix and repayment ratios. The trade data describe the flow that sits alongside that stock: each month of faster import growth than export growth adds to the foreign-currency requirements that rollovers, official financing and remittances must cover.
The export problem in context
Pakistan’s exports have historically hovered around $2.5 billion to $3 billion a month, The Express Tribune reported, and October’s $2.93 billion was within that range. The four-month total of $11.34 billion is 8.5 per cent higher than a year earlier, which is real growth, but it is slower than the 12.6 per cent rise in imports.
The government has projected goods exports of $34 billion this fiscal year. At the July-October pace, reaching that number would require a stronger second half of the year, and the 2029 target of $60 billion is further away still. The Express Tribune reported that the government’s trade liberalisation policy had not delivered the export increase that the Ministry of Commerce and the World Bank had projected; those projections had expected a 14 per cent rise in exports and a 7 per cent rise in imports.
The newspaper also pointed to a structural preference for large industries over small and medium-sized enterprises. Prime Minister Shehbaz Sharif has recently held meetings on SME financing, but the trade figures do not yet show a measurable shift. That is a policy judgment rather than a finding of the monthly data, and it will take more than one quarter of numbers to test.
What is still uncertain
The October figures are monthly data and are subject to revision. The services breakdown for October has not been published, so the four-month goods deficit is the most complete comparison available. The current-account balance, which includes remittances and income flows, will provide a fuller picture when the State Bank releases it.
It is also too early to say whether October’s import growth reflects higher volumes, higher prices or both. The Express Tribune reported the central bank’s $71 billion import projection for the year, but that is a forecast, not an outcome. Export growth of 8.5 per cent in July-October is an improvement on last year’s contraction, yet it remains below the pace needed to stabilise the gap at current import levels.
The next test is the November data, followed by the current-account release and the government’s next financing decisions. A single month of slower imports or stronger exports would not settle the trend; a sustained change in the relationship between the two would.
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