Pakistan exports to the United Kingdom have reached $2.025 billion in the fiscal year 2021, which is an increase of 33% when compared with the previous year.
According to Ministry of Commerce data, Pakistan’s exports to the UK primarily consist of textile and leather-related products.
Over the years, the UK has come out as Pakistan’s third-largest export destination, second largest source of foreign direct investment (FDI) and third largest source of remittances after Saudi Arabia and United Arab Emirates (UAE).
As a result, total bilateral trade between the two countries has reached over $2.648bn during FY21 against $2.122bn in the previous year, reflecting an increase of 25pc
The top export products to the UK in FY21 was home textile, which grew 42pc to $648 million from $456m in the previous year, followed by an increase of 57pc in apparel and clothing knitted or crocheted to $625m from $397m over the previous year, and increase of 5pc in apparel and clothing not knitted or crocheted to $304m against $2.88m in previous year.
The export of five products posted a growth but its exports in value term remain very less. The exports of surgical instruments posted a growth of 22pc on a year-on-year terms to $36m followed by 48pc in edible fruit and nuts, peel of citrus fruits to $31m, 55pc in furniture, bedding, mattresses, mattress to $30m and 241pc in beverages, spirits and vinegar to $20m, respectively.
However, the exports of cereals dipped by 2pc, cotton 4pc and article of leather 1pc during the year under review.
The main reason for the increase in textile products of Pakistan is due to the market diversification drive by the UK companies in the aftermath of the Covid-19 induced crisis. The companies have realised their vulnerability due to over-reliance on Bangladesh, India, and China.
Besides, Pakistan was among the first textile-producing countries to reopen the manufacturing facilities after lockdown, which gave the country a significant head-start over the competitors.
Contrary to this, Pakistan’s imports from the UK increased by 4pc to $623m in FY21 against $600m in FY20.
The top-ten import products include iron & steel (scrap and flat-rolled) $343m, machinery and mechanical $62m, chemicals $33m, medical apparatus $18m, respectively.
During 2020-21, remittances from the UK to Pakistan increased by 58 from $2.569bn in FY20 to $4.067bn. The remittances from the UK to Pakistan during this financial year have seen a robust increase, which is a good sign for the economy.
The UK is the fifth largest national economy in the world measured by nominal gross domestic product (GDP) comprising 3pc of world GDP. The size of GDP is $2.7 trillion, whereas per capita income is $40,406. The UK is the ninth-largest exporter and the fourth largest importer in the world. It possesses the second-largest stocks of inward and outward foreign direct investment.