FPCCI warns of rising trade deficit in Pakistan

The Federation of Pakistan Chambers of Commerce and Industry (FPCCI) has expressed serious concern regarding Pakistan’s widening trade deficit. During the first two months of Fiscal Year 2026-27 (July-August), the deficit increased by 18.1 percent to $7.1 billion, compared to $6.025 billion during the same period last year.

FPCCI President Atif Ikram Sheikh warned that the surge in imports is outpacing export growth, posing a threat to macroeconomic stability and foreign exchange reserves. He attributed the lack of export competitiveness to the high cost of doing business, specifically citing prohibitive interest rates and rising electricity tariffs.

Sheikh noted that high central bank policy rates prevent manufacturers from securing working capital or investing in modernization, while increasing power costs driven by capacity charges make it difficult for factories to scale production.