Trade gap narrows to $9.04bn in July-January

ISLAMABAD: Pakistan’s trade deficit with the Middle East narrowed by nearly three per cent during the first eight months of 2025-26, as the ongoing conflict in the region begins to weigh on commercial activity and bilateral engagement.

The full impact on Pakistan’s exports is yet to unfold. At the same time, imports, which account for the bulk of petroleum inflows from the region, are expected to decline more sharply once trade data for March are compiled.

In absolute terms, the trade deficit with the Middle East decelerated to $9.047 billion in July-February FY26 from $9.299bn a year ago, according to data compiled by the State Bank of Pakistan.

In its March report, the Planning Commission of Pakistan has already warned the government of potential economic repercussions of the Gulf crisis, including higher energy costs, pressure on remittance inflows, and possible disruptions to exports and financial stability.

In FY25, the trade gap with the region widened 7.37pc to $13.974bn from $13.014bn in FY24.

Planning Commission alerts to economic fallout of ongoing Middle East crisis

Planning Commission alerts to economic fallout of ongoing Middle East crisis

Exports to the Middle East fell 1.07pc to $2.122bn in 8MFY26 from $2.145bn over the corresponding months of last year. There are predictions that exports will fall further if the war continues.

In FY25, exports to the region fell 1.52pc to $3.107bn from $3.155bn in the preceding year.

At the same time, imports, mainly........

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