Covid-19 and Its Impact on Trade And E-Commerce in Pakistan

Abstract

This thesis aims to study the impact of the COVID-19 pandemic on trade flows in Pakistan. The thesis investigates not only the effect of the pandemic on trade in goods and services, but also examines the commodity-wise trade flows that have been affected due to the pandemic, through monthly data collected from March-December 2020. Besides, the thesis also identifies the export opportunities for Pakistan which comprises of critical commodities related to COVID-19. Furthermore, social distancing protocol has led to a growth in E-commerce around the world, as more people now prefer to shop from home than to go outside and interact physically with others. The other major objective of this study is to observe whether Pakistan’s consumers believe that the country’s digital economy has evolved with the spread of the virus, with primary data collected through a questionnaire targeting consumers with stable connections to the internet. The results of this research show that during the initial three months since the beginning of the pandemic, exports and imports of goods and services declined due to domestic lockdown and border closures of Pakistan’s major trading partners. Following August 2020, both exports and imports witnessed a rising trend as lockdowns eased both domestically and internationally. The analysis highlights the fact that export of textiles and imports of machinery increased in the last two months of 2020. Similarly, export of transport and telecommunication services increased while imports of transport and other businesses grew during the same period. There are abundant opportunities for Pakistan to gain foreign exchange revenue through the export of ethyl alcohol and therapeutic respiration apparatus which are highly demanded by other COVID-19 hard-hit economies (Germany, UK, Italy, France, USA, etc.). The results of the survey indicate that people are preferring to shop online, and they attribute this increase to the fear of COVID-19’s spread.