An Empirical Investigation on the Role of exports, imports and its Determinants in Foreign Trade of Pakistan

Abstract

Foreign trade was restrained by fluctuations and depreciations in currencies, nations were under financial pressure to implement protection measures in form of custom duties tariffs. These theories and thoughts have enormous impact on rules and policies of global trade throughout the world. To adopt economic liberalization and free trade zones nations all over the world are connected through number of agreements since last few centuries. In this revolutionized economic system, nations allow free trading of merchandise and services and at the same time don't have to impose tariff in form of import and exports duties. This study attempted to empirically evaluate the role of imports, exports and its determinants in foreign trade of Pakistan applied ARDL Approach for the period of 1972-2015. The study recommends that economies with significant competitiveness and comparative advantage will be greatly benefited from export promoting policies. As far as trade partners are concerned, no considerable efforts have been done to explore new markets in direction of Pakistan's foreign trade since its independence. The key trading partners of Pakistan in the beginning were the developed countries of West and still they are main trading partners of Pakistan.

Managing effects of Forex Rate’s fluctuation on Pakistan’s Trade Balance

“…Several Asian economies, such as Taiwan, China, Malaysia, & South Korea, have expanded growth in their economy through enhancing their exports. , (Hassan M. M., 2021) , (Li, 2016) & (Kandil, 2017) Nevertheless, numerous developing states face the issue of trade shortfall problem in Global Trading as of augmented imports as related to their exporting. Utmost Specialists in Economics suggest strategies supporting exporting with a flexible forex rate.…”

Examining the Trade Determinants and Potential of Pakistan: A Gravity Model Analysis

“…In contrast, the trade policy of Pakistan lacks smoothness and witnesses many ups and downs. In the initial years, the country successfully implemented Import-Substitution Industrialization (ISI) and recorded high growth rates in the 1960s (Ali & Li, 2016). However, by the mid-'70s, many economists in the country advocated an export-led growth strategy to benefit from increased global liberalization.…”