Trade deficit with Middle East soars 22pc

ISLAMABAD: Pakistan’s trade deficit with the Middle East surged by 22.38 per cent in the first month of FY26, largely driven by the rising influx of petroleum products from the region.

According to data compiled by the State Bank of Pakistan, the trade deficit with the Middle East reached $1.323 billion in July FY26, up from $1.081bn during the same month last year.

In FY25, the deficit with the region increased by 7.37pc, rising to $13.974bn from $13.014bn in the previous year. The growing trade imbalance has raised concerns among policymakers, with the primary culprit being the rising import of petroleum products from the Middle East.

While petroleum consumption has increased, exports to the region have only seen modest growth, concentrated in a limited number of countries.

Exports to the Middle East declined by 16.11pc in July FY26, falling to $254.15 million from $302.99m in the same month of the previous year. For FY25, exports to the region dropped by 1.52pc, reaching $3.107bn, compared to $3.155bn in FY24.

At the same time, imports from the Middle East saw an increase of 14.02pc, rising to $1.578bn in July FY26, compared to $1.384bn in the same period last year. In FY25, imports grew by 5.64pc, reaching $17.081bn, up from $16.169bn in FY24.

Exports to Saudi Arabia fell by 5.95pc, reaching $54.02m in July FY26, down from $57.44m in the same month last year. Imports from Saudi Arabia also declined by 7.73pc, totalling $330.95m compared to $358.71m in the previous year.

Exports to the UAE saw a sharp decline of 18.56pc, falling to $176.65m in July FY26 from $216.92m last year. However, imports from the UAE surged by 47.77pc, reaching $816.01m, compared to $552.22m in July FY25.

Exports to Bahrain stood at $5.41m in July compared to $4.85m in the corresponding period last year. Imports from Bahrain, however, saw a sharp increase, rising to $14.01m from just $2.64m.

Published in Brackly News, September 9th, 2025