Why is Pakistan having a trade deficit with majority of the countries?

[Introvert]

Just curious.

 

[David James]

Its very simple pakistan imports more and then it exports to the most of the countries.

The imports can be divided into 2 categories raw materials and finished goods.

To bridge the gap you need to reduce the imports, for it you need:

- To look out locally (in pak itself) for the raw materials that you imports

- To build the finished goods domestically that you tend to import. This is very difficult as pakistan don't have quality products and industries.

 

[Abingdonboy]

Pakistan does not have a mature enough manufacturing industry.

 

[bhisma]

Stop importing things which you can manufacture in your country, or simply increasre export duties..

OR else stop trading with nation which enjoys more trade surplus with you.. e.g. China

 

[Bharthi]

Exports
textiles (garments, bed linen, cotton cloth, yarn), rice, leather goods, sports goods, chemicals, manufactures, carpets and rugs

Imports
petroleum, petroleum products, machinery, plastics, transportation equipment, edible oils, paper and paperboard, iron and steel, tea(these need heavy machinery)

 

[nForce]

Exports
textiles (garments, bed linen, cotton cloth, yarn), rice, leather goods, sports goods, chemicals, manufactures, carpets and rugs

Imports
petroleum, petroleum products, machinery, plastics, transportation equipment, edible oils, paper and paperboard, iron and steel, tea(these need heavy machinery)

If its mainly due to petroleum,then very less can be done about it.The only way that remains is increasing the export rather than trying to decrease import.

 

[karan.1970]

I read today that Pakistan has had a trade deficit of 6 billion USD with India in last 6 years.. And that was before India got the MFN status..

 

[Chinese-Dragon]

OR else stop trading with nation which enjoys more trade surplus with you.. e.g. China

You guys should follow this advice first, since India's trade deficit is MUCH bigger than the Pakistani one.

In fact, India's trade deficit to China alone, is already several times bigger than the entire Pakistani trade deficit.

Trade Gap Strains India-China Ties - WSJ.com

India's trade deficit with China jumped 42% to nearly $40 billion in the last fiscal year ended March 31, and was the largest contributor to the country's overall gap between exports and imports.

India's trade woes have become a serious economic threat for the nation. The country's current account deficit—which measures the balance of trade with the world—was 4.5% of gross domestic product in the quarter that ended March 31, an all-time high. That has contributed to a sharp depreciation in the rupee and has put enormous pressure on India to attract foreign capital.

 

[ajtr]

I read today that Pakistan has had a trade deficit of 6 billion USD with India in last 6 years.. And that was before India got the MFN status..

When did india got MFN.....im curious.....

 

[AZADPAKISTAN2009]

Pakistan since my Pakistan Studies days , where I learnt the same stuff that my parents did when they larnt in their school days that

>Pakistan is a Agricultural Country


Which of course is not completely try but the Policies of our Nation are intent on keeping it as an Agricultural Country for two reasons , being the lifeline , no one dares impose taxes on Agricultural Land. And no one dares to question or inturrupt the system.


The policies in Nation have resulted in completed Neglect of Industrial Growth with in Pakistan to point that Majority of the Electronics, Mechanical Goods etc are all imported

a) Small Appliances - Imported goods are sought after
Pakistan does makes small stuff like fans , or ceiling fans etc
b) Large Appliances - Imported goods are sought after
Most stuff like Washing machine or other large items like Oven are all coming from overseas
c) Large House Items
Cars , Motor Bikes again all are being imported from outside
Some companies assemble some items and put Made in Pakistan sticker on it to make it look that they are making it
but that is just to by pass red tape.

d) Large Mechanical Machines
Cranes , Trucks , Busses from my knowledge all are being imported from China , Korea , Japan

e) Electronics
Cameras
Watches
Computers
Laptops
Apple computer goods

Not even the sub components , like mouse is made in Pakistan every thing is imported in form China or Asian countries


The only industriess that Pakistan had supreme control over were
a) Textiles (Which now is in tatters , and ruines due to electricity problems and people moving business to Bangladesh)
b) Sports goods and leather , after FIFA introduced new laws , Pakistani Hand Stitched balls are not used in official Soccer
games. FIFA changed the laws too use Machine stitched balls so that European companies can benefit from contracts
to supply goods


Right now ...

Since these industries are not setup in Pakistan , an estimated 100,000-500,000 jobs probbly are not created inside Pakistan which is why large majority of Pakistanis are moving abroad

Its failiure of Government to not protect growth of local Industry by putting Taxes and Heavy Tarrifs to insure that locally produced goods are 10-15% cheaper then any good imported form outside



Biggest Problem in Pakistan is there is no Ministry that`s sole mission is growth of Local Business and protection of Local Business


Think about it a Pakistani Business man spends 100,000 USD sets up a computer manufacturing plant and his computers sell for 2,000 USD /Computer

Then off comes a Pakistan Exporter/Importer, he gets in deal with someone from Japan/Tiwan etc
and then he brings in computers that cost 1200 USD/Computer

Yes Pakistani Business will fail .

If the computer was made / assembled and distributed in Pakistan it would have created 100 jobs with potential to grow to 500-1000 workers over 1-2 years

but because now its exported in may be 1-5 jobs are created in export/import side , and all family based ...

If that was not enough , now there is no electricity ... great .. forget about business

This is why Pakistan is a Agricultural Country was true in 1947
This is why Pakistan in Agricultural Country was true when my Parents were in school 70's
This is why Pakistan is Agricultural Country was true when I was in school
This is why Pakistan is Agricultural Country will be true when my Grandchildren will be in school

 

[RazorMC]

Pakistan mainly exports goods which have a much lower value compared to our imports. These include textiles, raw materials and agricultural produce.

To reduce the deficit, we need to shift the focus away from the current sectors and encourage industrialization on a large scale, increase focus on technological exports (software development and Call Centre/BPO) and other manufactured goods esp. machinery.

But all this needs electricity. And we don't have enough of it

 

[RazorMC]

...
a) Small Appliances - Imported goods are sought after
Pakistan does makes small stuff like fans , or ceiling fans etc
b) Large Appliances - Imported goods are sought after
Most stuff like Washing machine or other large items like Oven are all coming from overseas
c) Large House Items
Cars , Motor Bikes again all are being imported from outside
Some companies assemble some items and put Made in Pakistan sticker on it to make it look that they are making it
but that is just to by pass red tape.

d) Large Mechanical Machines
Cranes , Trucks , Busses from my knowledge all are being imported from China , Korea , Japan

e) Electronics
Cameras
Watches
Computers
Laptops
Apple computer goods

Not even the sub components , like mouse is made in Pakistan every thing is imported in form China or Asian countries

a) Pakistani fans are very good, but we have failed to market them effectively.

b) I don't know aobut this one. What about SuperAsia washing machines, aren't we making them here? But they are very basic models. The world has moved years ahead and demand for our goods is diminishing.

c) The problem with motor vehicles is that we made a poor decision to allow their sales in Pakistan without joint-venture (like Atlas-Honda and Suzuki-Maruti). We could have got the technology to make them in Pakistan and started our own industry.
And now Chinese bikes have filled the roads.

d) and e) No-one can compete with Chinese mass-manufacturing but we can focus on high-quality goods like what Japan did.

...Think about it a Pakistani Business man spends 100,000 USD sets up a computer manufacturing plant and his computers sell for 2,000 USD /Computer

Then off comes a Pakistan Exporter/Importer, he gets in deal with someone from Japan/Tiwan etc
and then he brings in computers that cost 1200 USD/Computer

Hmmm. There's more to it thatn just money. Exporting goods allows certain people to move their black money out of the country, this is also one of the reasons for the net reduction in foreign reserves.

 

[Edevelop]

70% of Pakistan's economy is dependent on agriculture. We need to improvise by make sub divisions out of it. If we produce mangoes and dates, we should try to make sugar or dried products out of it. If we produce berries, we should make wine for export. If we have opium and marihuana, we should make it for medicine. The import of olives and tea has reached as high billions of dollars worth of money. Again, we have to go and study our own country before making any moves. Last i checked, these things are all growing wild....

There is so much potential with just one industry. I bet others who are in different sectors will be seeing this as an example of becoming successful. Only if there is a system in place in Pakistan then we can make ourselves efficient.

 

[AZADPAKISTAN2009]

Import and export is popular as it allows seemingly low class education person to make money you don't need PHD that is why its popular in Pakistan , people importing phones , cars, electronics and other stuff

In essense GOV encourages , such people over lets say a MBA , business genius to build a international level business operating from Pakistan

This is our government's mindset ...

"SHORT TERM" quick change vs long term Billions


When all fails they cry wolf and say .. oh why don't private sector create jobs ...
well Chaha ... when you will not protect local market how will private sector make jobs ??

In general , when someone is a Agricultural society , one must expect the prices of the food to be cheapest in the society
but that is not the case in Pakistan

Why? Why is it that Pakistan who produces wheat , Rice and all the meat from farms the people cannot afford to eat these items

Or even dried fruits / Nuts

a) Almonds , penuts etc .. are increasing in price

Pakistani Raw material is "Under Priced in world Market" and we are paying 3-4 times the price for Energy



Imagine ... for a second ..


1965 ... if we were in 1965 and we had constructued , Kala Bagh Dam back in 70's

42 Years ago , and we would have made 2 billion dollar worth of Energy per year , we could have generated
84 Billion Dollars

What could we have done with these 82 Billion dollars ?

a) Atomic Energy Plants
b) Our own Automobile Industry
c) Financed Space program
d) Populated Balouchistan with a mega city
e) Financed our own Coal Energy Projects where we do not pay royalties to anyone
f) Financed the Iran - Pakistan gas line
g) Constructed 100 Universites in Pakistan of high quality

And , perhaps the flooding disaster of 2010 would never have had happened instead we would have saved water in our dam for 20years supply


There is something wrong .. something very very disturbingly wrong in the DNA of people who are in power in Pakistan and it has to be genetic , because any other way you look at it , any human when you tell him do this and you will get 100 mangoes of courses the person will do it .. as oppose to say .. oh well ... I will not do it because if I work hard I might get some dirt on my clothes and so I will sit under the tree and be happy with my 1 apple that I hold in my hand

 

[AZADPAKISTAN2009]

From my view point ...

There is no difference between California and Pakistan its the same environment , weather and geographics ..

Whats different is that one is Silicon valley and Hub for major companies and corporation and other is " so called agricultural center"

Pakistan is really close to

a) California
b) Miami

If you really look at it

Plus we have the Agricultural power as Taxes

So why is that we are no where near as to these states , in term of production and income generated


A country blessed as Pakistan should be hub for

a) Tourist
b) Businessman
c) Traders

After all this region was doorway to Asia from centuries so something needs to be done