Pakistan’s oil import bill rose by more than 97 percent to $4.59 billion during the first quarter of the current fiscal year (3MFY22) from $2.32bn during the same period last year because of the surging prices in the global market and depreciation of the local unit.
The constantly widening import bill of oil is triggering the trade deficit and can cause challenges for the government on the external side. The record increase in prices of petroleum products for local consumers was witnessed during the first quarter of the current fiscal year.
As per data from the Pakistan Bureau of Statistics (PBS) the import of petroleum products rose by 93.21pc in value and 10.86pc in quantity.
Crude oil imports increased by 81.15pc in value and dropped by 2.35pc in quantity during the months under review. Liquefied natural gas saw an increase of 144.02pc in value. Liquefied petroleum gas imports spiked by 53.95pc in value during July-Sept FY22.
The second biggest contributor to the import bill is food items. The food import bill saw an increase of more than 38.03pc to $2.36bn during the first three months of the current fiscal year in comparison to $1.71bn during similar months in last year.
Another major concern for the government is the expanding food import bill the resultant trade deficit. The country spent more than $8bn on the import of edible items during the last financial year.
The food import bill is expected to rise further during the next few months as the government has made the decision to import 0.6m tonnes of sugar as well as 4m tonnes of wheat to build strategic reserves.
The total import bill jumped up by 66.11pc to $18.74bn in July-Sept FY22 in comparison to $11.28bn last year.
The growth in import bill of all food items during the first quarter of the ongoing year indicated a shortage in domestic production. Food items including wheat, sugar, edible oil, spices, tea and pulses were the major contributors to the food imports.
The import of edible oil increased significantly in both quantity and value.
Palm oil imports grew by 53.91pc in value during July-Sept FY22 to $891.15m from $579.008m during the same time last year. In terms of quantity, the import of palm oil recorded a 14.80pc negative growth during the same period. Rising international prices caused the increase in palm oil import bill.
The last few months have witnessed an increase in the prices of vegetable ghee and cooking oil for the local consumers. The import of soya bean oil saw a drop of 54.61pc in value and 74.42pc in terms of quantity during 3MFY22 compared to a year ago.
Pakistan has imported 338,036 tonnes of wheat in the first three months of FY21 against 431,593 tonnes imported during the prior year. This shows a decline of 21.68pc. During the first nine months of last year, The government also imported 3.612m tonnes of wheat worth $983.326m during first nine months of last year while there were no imports during the year before that.
This year, no wheat has been imported between April to July. The Economic Coordination Committee (ECC) of the cabinet has made the decision to import four million tonnes of wheat for the purpose of keeping buffer stock.
The import of sugar was standing at 157,827 tonnes in July-Sept FY22 against 30,134 tonnes last year, reflecting an increase of 423pc. Sugar price is on the rise, as it reaches a rate as high as Rs115 in the retail market.
Tea and spices saw growth in imports by 6.46pc and 40.09pc, respectively, during July-Sept FY22. The growth is primarily owing to a decline in import of these products under transit trade and checks on smuggling in border areas.
The import bill of pulses, dried fruits, milk, and other food products also saw noteworthy growth in July.
The machinery import bill rose by 35.15pc to $2.84bn in July-Sept FY22 compared to $2.10bn during the same month last year. Import of power-generating machinery jumped up by 24.94pc in the months under review mostly owing to China-Pakistan Economic Corridor related projects.
