Imports in November 2018 stood at $4.6 billion – fifth consecutive month for imports under $5 billion. That is about the only silver lining. Exports also stood under $2 billion for the third month in a row. The monthly trade deficit has also continues to stay under $3 billion. Detailed numbers are yet to come out – but the slight respite in imports seems largely due to a massive 25 percent month-on-month drop in crude oil prices.

Petroleum imports have averaged 28 percent of the total imports in the fiscal year so far. Machinery imports were already on a decline, from an average of a billion dollar per month in FY18 to $750 million in 4MFY19. If the machinery imports have not suddenly picked up again in November, it appears that other imports have once again resurfaced, even when accounting for more LNG imports during the month, owing to higher gas demand.

Pakistan’s long standing romance with furnace oil has weakened, but is not over by any stretch of imagination. The share of FO based power generation has drastically come down, but it will take another two years before it is completely off the menu. Meanwhile, natural gas shortage in peak demand at home means more imported fuel in the form of RLNG to keep the power plants running. Luckily, oil prices have of late played in Pakistan’s favour.

For an economy already showing signs of slowdown, other imports should also come down sooner than later. The CPEC having entered into the second phase means lower machinery imports – but that could also mean added fuel requirements to pump the machinery. The axe on PSDP should result in lower construction related import items as well. The big question mark is on the food and agriculture imports – which have proved to be rather sticky.

On the exports front, there is not much to cheer about. Not yet at least. Now that the textile players have got their wish of reduced electricity input rates – it remains to be seen whether this actually translates in higher exports, or goes in the domestic market for consumption and improve the bottom lines. Power availability and affordability, were picked as the two main irritants by the textile industry – both of which have been largely taken care of. The onus is on the industry now to let the numbers do the talking. With the LSM growth at multiyear low, it looks a daunting task for the manufacturing sector to turnaround the fortunes, and helps earn Pakistan more dollars.