Containing Imports Chapter 17: Containing Imports The need for containing imports has emerged not only because Pakistan needs to achieve a degree of self-reliance as the economy develops but also because in coming years Pakistan is faced with large external debt repayment obligations. Between 2021-22 and 2023-24 the cumulative repayment is estimated at$40 billion. Therefore, the current account deficit in the balance of payments will have to be maintained at significantly below 2 percent of the GDP, to limit the external financing requirements. This will require simultaneous containment of imports and the acceleration of exports. This chapter first highlights the historical relatively rapid growth in imports. The composition of imports is examined to see where there has been a greater upsurge in recent years. This is followed by quantification of the extent import substitution that has been achieved in the country. The existing nature of import policies is examined, especially from the viewpoint of effective protection to economic activities in the country. Proposals are then formulated for greater containment of imports. 17.1. Growth in Imports The growth in imports is seen in relation to the growth in the GDP and in exports. A comparison is made in Table 17.1. The imports and exports to GDP ratios are shown from 1999-2000 to 2020-21. The Table clearly demonstrates the substantial rise in the imports to GDP ratio. It has increased from 13.2 percent of the GDP in 1999-2000 to reach a peak of 20 percent of the GDP in 2017-18. Table 17.1: Trend in The Imports, Exports and the Trade Deficit to GDP Ratios (at current prices)(% of GDP) Imports* Exports* Trade Deficit 1999-2000 13.2 12.1-1.1 2004-05 17.8 14.3-3.5 2009-10 19.4 14.1-5.3 2014-15 17.0 10.6-6.4 2017-18 20.0 9.0-11.0 2020-21 17.9 8.5-9.4 *Goods and services Source: PES 165