Trade deficit with China swells to $6.2bn

[Perpendicular]

KARACHI: Pakistan’s trade deficit with its largest trading partner China widened to $6.223 billion in the previous fiscal year.

The increase in the deficit came as Pakistan’s exports to China falter while imports from that country have been increasing for the last five years.

The volume of Pakistan’s overall trade with China was $10.029bn in the fiscal year 2015-16, including $1.903bn exports and $8.126bn imports.

There is no improvement in trade in favour of Pakistan with Beijing despite China-Pakistan Economic Corridor (CPEC). Though shrinking foreign direct investment in Pakistan was still dominated by China during FY16, the size was insignificant.

The trade deficit with the United Arab Emirates (UAE), which was the second biggest exporter to Pakistan after China, was $4.941bn in the preceding fiscal year.

Pakistan imported goods worth $6.021bn from the UAE while the exports were just $1.080bn. Both exports and imports to the Emirates dropped in the previous fiscal year.

Some analysts have cautioned that the rising Chinese influence in the economy of Pakistan could be counterproductive if Islamabad failed to avail the opportunities emerging out of close relations with Beijing.

Due to unusually large trade deficits in the preceding fiscal year, Pakistan had to use remittances being sent by the overseas Pakistanis to meet the shortfall. The remittances in FY16 came in at $20bn, but the country still faced the current account deficit of more than $2.5bn.

Published in Dawn, August 16th, 2016

 

[LA se Karachi]

Much better than India's $45 billion trade deficit with China:

"Worryingly for India, exports to China fell by over 18% last year and were pegged at $13.38 billion. China exported goods worth $58.25 billion in the same period.


The latest figures revealed the nature of imbalance in bilateral trade – while India mostly exports raw materials to China, the latter ships back finished goods."


http://www.hindustantimes.com/busin...illion-mark/story-3BET8zNIXGd2UccIsCsEnM.html

 

[Viper0011.]

KARACHI: Pakistan’s trade deficit with its largest trading partner China widened to $6.223 billion in the previous fiscal year.

How could there not be a trade deficit when China is building half the Pakistan's infrastructure?? About 75% of the work has been going to the Chinese specialist companies who then employ Pakistani labor. So there isn't much trade. The real trade will start post CPEC phase I, when the Chinese will actually start to use the route for shipping, etc, and the Central Russian States will also use this route to get products from Chinese distribution and manufacturing centers inside Pakistan. Till 2018, this gap would widen, but post 2018, the gap would close off very fast as majority of the projects would've come online. That would be the right time to measure trade.

 

[Nilgiri]

Much better than India's $45 billion trade deficit with China:

"Worryingly for India, exports to China fell by over 18% last year and were pegged at $13.38 billion. China exported goods worth $58.25 billion in the same period.


The latest figures revealed the nature of imbalance in bilateral trade – while India mostly exports raw materials to China, the latter ships back finished goods."


http://www.hindustantimes.com/busin...illion-mark/story-3BET8zNIXGd2UccIsCsEnM.html

Its better to measure by ratios rather than absolute amounts.

China exports to Pakistan 8 times what it imports.

China exports to India about 4 times what it imports.

Pakistan is definitely doing worse than India in the trade deficit with China but as @Viper0011. has pointed out, it is to be expected given CPEC.

 

[BABA AGHORI]

How could there not be a trade deficit when China is building half the Pakistan's infrastructure?? About 75% of the work has been going to the Chinese specialist companies who then employ Pakistani labor. So there isn't much trade. The real trade will start post CPEC phase I, when the Chinese will actually start to use the route for shipping, etc, and the Central Russian States will also use this route to get products from Chinese distribution and manufacturing centers inside Pakistan. Till 2018, this gap would widen, but post 2018, the gap would close off very fast as majority of the projects would've come online. That would be the right time to measure trade.

Expect Kids and the Currency nearly every things is Chinese these days ... CPEC will only do wonders....

 

[Rafael]

I don't know what the issue is. India has the money and stands on its own legs, so trade deficit not an issue.

Pakistan simply send its PM and COAS to smile and dance for Xi and China will simply 'reward' Pakistan suitably. voila, no deficit

Dancing and Mujras are Indian specialty. You guys love to watch and do them.

 

[Shotgunner51]

Putting aside protectionism, global trade is largely determined by fundamental economic structure and currency exchange rate. China is the world's largest industrial-exports economy, in the calendar year of 2015 exports amounted to US$2.284 trillion, 57% of which was electro-mechanical, followed by electronics, labour-intensive has dropped to below 20%. High-tech (as per UN Comtrade) is the pillar of Chinese exports, amount already highest in the world even more than US-Germany-Japan combined.

Such a structure determines that most countries will record trade deficit with China, it's very normal.

Note, China does record trade deficit with several economies, again it's due to economic structure. Highest deficit was recorded with Taiwan which controls 70% of global chipset fab (China imports was US$1.689 trillion in 2015, chipset alone is close to US$200 billion, was largest imports item overtaking crude oil), followed by South Korea, Germany, Japan, all four are advanced industrial-exports economies. To a lesser extent, China also records trade deficit with resources exporters e.g. KSA, Australia, Chile, Peru, with whom imports are partially offset by China's industrial exports.

Pakistan is in the early stage of infrastructure building and industrialization, capital goods like electro-mechanicals, heavy machineries, CNC machines, machine tools, transport system, telecom equipments, computers, electronic components, steel/materials, chemicals, are much needed. Pakistan imports of capital goods are far from enough for her massive infrastructure and industrialization plans, it's only expected to increase as long as investment (both foreign & domestic) sustains momentum until Pakistan become a moderately developed nation.


https://defence.pk/threads/india’s-trade-deficit-with-china-jumps-to-53-billion-in-2015-2016.442335/
http://data.worldbank.org/indicator/TX.VAL.TECH.CD?year_high_desc=true

 

[BABA AGHORI]

Dancing and Mujras are Indian specialty. You guys love to watch and do them.

Is it ?? Just search on youtube Pakistani Mujra you will surly change your opinion my friend. believe me they are better..

 

[IceCold]

Is it ?? Just search on youtube Pakistani Mujra you will surly change your opinion my friend. believe me they are better..

Isnt Mujra part of Hindu religion? I am sure you guys do better.

 

[I S I]

Isnt Mujra part of Hindu religion? I am sure you guys do better.

Gandhi invented mujra. Meera perfected it.

 

[BABA AGHORI]

Isnt Mujra part of Hindu religion? I am sure you guys do better.

I just shared my opinion, and on searching online - it's originated in Mugal era ... elements from Khatak ... I am not sure who takes pride of Mugal culture and there rulings in the subcontinent ...... do you have any idea ?.. SIR..

 

[RealNapster]

Isnt Mujra part of Hindu religion? I am sure you guys do better.

They even do mujra to there God's and Goddesses.. And seriously , i don't want to bring this up, Apologizing even before saying it. But in many movies we have watched that item number by "devi maata"............ Again... Sorry for being rude.

 

[Yousafzai_M]

I don't think there is any country in the world that has a trade surplus with China!

 

[niaz]

Chinese workers are efficient, machinery up to date and salaries low. While Chinese goods may not match the German finesse & durability; are of adequate standard. Hence few countries can compete with Chinese manufactured goods on price. That is why China has accumulated an astronomical $4-trillion in FE Reserves. With the CPEC, flow of Chinese goods will increase and we should expect the trade balance to get worse.

Being pious Muslims, Pakistanis care nothing of progress in this world. We prefer to take short cut to Heaven by blowing ourselves up and killing the countrymen who we think have strayed from the right path.

By the way, India is fast catching up with China. I was surprise to find that the pair of leather shoes I bought from ‘Loake Shoes’, a famous shoe company from Northampton, were in fact made in India. UK stores are full of household utensils and pressure cookers etc. made in India. Samsonite suitcase I purchased in Dubai was also made in India.

PML-N are keen on giving India ‘Most favoured Nation’ status, should this happen, you will see Indian goods & medicines filling up shelves of Pakistani shops, why not if the same are cheaper and of better quality.

How could there not be a trade deficit when China is building half the Pakistan's infrastructure?? About 75% of the work has been going to the Chinese specialist companies who then employ Pakistani labor. So there isn't much trade. The real trade will start post CPEC phase I, when the Chinese will actually start to use the route for shipping, etc, and the Central Russian States will also use this route to get products from Chinese distribution and manufacturing centers inside Pakistan. Till 2018, this gap would widen, but post 2018, the gap would close off very fast as majority of the projects would've come online. That would be the right time to measure trade.

There is a lot of trade. Pakistan exported $2.77-billion worth to Chin to China in 2014 and is the 2nd largest export destination of Pakistani goods.

http://atlas.media.mit.edu/en/profile/country/pak/

It is that imports from China are far larger. Let us not forget that for some time China has been the primary supplier of defence hardware to Pakistan.

CPEC would probably see more imports of Chinese goods in Pakistan.

 

[LA se Karachi]

Its better to measure by ratios rather than absolute amounts.

China exports to Pakistan 8 times what it imports.

China exports to India about 4 times what it imports.

Pakistan is definitely doing worse than India in the trade deficit with China but as @Viper0011. has pointed out, it is to be expected given CPEC.

I know. But the general point I was trying to make is that most countries have large trade deficits with China. And as you and others have pointed out, this is particularly to be expected because of CPEC.