Trade Crisis: Pakistan’s Rice Exports Plunge as Trade Deficit Hits $19 Billion

New data from the Pakistan Bureau of Statistics (PBS) revealed a staggering 49.56% collapse in rice exports during the first half of the fiscal year (July–December). Total earnings for the staple crop fell to just $405 million, down from over $804 million in the same period last year. The decline was most severe in the premium Basmati segment, which plummeted by 52.68%. Analysts point to a “perfect storm” of challenges, including the re-entry of Indian rice into global markets at lower prices and the prolonged closure of trade routes with Afghanistan, which has been suspended since October 10, 2025.

While exports withered, the national import bill surged to $34.5 billion, driven by a 21% increase in food imports and nearly $1 billion spent on mobile phones. This imbalance has pushed the country’s trade deficit past the $19 billion mark, a 35% year-on-year increase that is placing immense pressure on foreign exchange reserves. Beyond rice, the textile sector, the backbone of Pakistan’s economy, also contracted by 8.56%, while zero sugar was exported this year compared to $145 million in late 2024.

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Exporters are now warning of “structural failure,” citing high financing costs, estimated at 600 basis points higher than regional competitors, and a managed rupee appreciation that has priced Pakistani goods out of the market. Without immediate policy intervention to lower input costs and reopen regional trade borders, the Rice Exporters Association of Pakistan (REAP) warns that the country risks losing its global market share to India and Vietnam permanently.

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