ISLAMABAD: Pakistan’s exports of services registered an 18.27 percent year-on-year increase in July, the opening month of FY26, largely supported by higher earnings from telecommunication, computer, and information services. Data from the Pakistan Bureau of Statistics showed that exports climbed to $745.52 million compared with $630.38m in the same period of the last fiscal year. On a month-to-month basis, the rise was 4.47 percent. In rupee terms, the figure stood at Rs211.89 billion against Rs175.49bn last year, reflecting the continued role of the services sector in generating foreign exchange inflows.
The strong performance was led by IT and digital categories, which grew by 23.77 percent to $354m in July from $286m in the same period of FY25, according to the State Bank of Pakistan. Other business services also contributed to the expansion, posting a 17.96 percent increase to $151m from $128m last year. Transport services rose 21.54 percent to $79m against $65m a year ago, indicating higher international demand in the segment. Travel services, however, registered a steep decline of 20.33 percent, falling to $47m from $59m, reflecting weaker outbound activity or subdued demand compared with last year.
While exports delivered strong growth, imports of services edged lower by 0.61 percent in July, totaling $871.44m compared with $876.83m in the same month of FY25. Transport services imports dropped 2.97 percent to $391m from $403m a year earlier, while spending on business services also eased. In contrast, imports of travel services rose 16 percent, reaching $210m compared with $181m in the previous year, showing a higher outflow linked to outbound travel. On a month-to-month basis, however, overall imports grew by 3.41 percent, underscoring steady demand despite the slight yearly decline.
The combined effect of higher exports and marginally reduced imports brought down the country’s trade deficit in services by nearly half. The deficit narrowed by 48.91 percent, falling to $125.92m in July FY26 compared with $246.45m a year earlier. This improvement provides some relief to external balances at a time when goods exports remain exposed to volatility. In FY25, Pakistan’s services exports had already grown 9.23 percent to $8.39bn, up from $7.68bn in FY24, supported primarily by the IT sector. Although the segment experienced a 6.5 percent dip in August 2024, sustained momentum since February 2024 has kept digital services at the forefront of earnings growth. Analysts note that the sector, particularly IT and telecom-related exports, is expected to remain a crucial driver of foreign exchange in FY26, even as merchandise trade continues to face global headwinds.
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