Pakistan's reliance on imported food deepened sharply in fiscal year 2025-26, as the food import bill climbed 11.66 percent to $9.150 billion, driven by a massive spike in sugar and edible oil purchases. The surge, from $8.195 billion the previous year, widened the country's food trade gap after exports of raw food items fell by nearly a third. Main Developments Official data shows raw food exports tumbled 29.49 percent to $5.017 billion in FY26 from $7.116 billion in FY25. The decline was broad-based, hitting nearly every major category except meat, which grew 7.10 percent year-on-year. Fish exports edged up 3.57 percent. Sugar imports saw an unprecedented leap. Pakistan imported 309,545 tonnes of sugar in FY26 — an increase of 8,716.43 percent compared to just 3,508 tonnes the year prior. In value terms, sugar imports jumped to $175.182 million from $3.508 million, a rise of 4,893.80 percent, following government approval for large-scale imports to address domestic shortages and rising prices. Read also: Why Pakistan's fish export data doesn't add up Palm oil remained the largest imported food item. Its import bill reached $3.785 billion, up 11.54 percent from $3.395 billion, with volumes rising 8.36 percent to 3.482 million tonnes. This reflects higher consumption of edible oil and ghee. However, imports of pulses fell 18.13 percent to $832.038 million, and soybean oil imports dropped 68.41 percent to $108.683 million. Rice exports, a key foreign exchange earner, fell 31 percent to $2.291 billion. Non-basmati rice was hit hardest, with export earnings down 42.57 percent to $1.448 billion and volumes dropping 30.18 percent. Basmati rice exports edged up 1.5 percent in value but volumes slipped 1.66 percent. Vegetables exports plunged 55.72 percent, fruits dropped 0.02 percent, tobacco fell 14.41 percent, and spices declined 8.77 percent. Background The suspension of bilateral trade with Afghanistan in October 2025 dealt a severe blow to fruit and vegetable exports, which historically relied heavily on that market. The Ministry of Commerce responded by extending a subsidy scheme for rice exports by three months, until September 30, and raising the Duty Drawback of Local Taxes and Levies (DLTL) rate for non-basmati rice to support exporters facing weaker international demand. The surge in sugar imports marks a stark reversal from the previous year, when only 3,508 tonnes were imported. The government's decision to allow large-scale imports reflects persistent domestic supply gaps and price pressures. Palm oil imports have grown steadily, driven by population growth and dietary habits that rely heavily on edible oil and ghee. Why It Matters The widening food trade gap increases Pakistan's vulnerability to global price shocks and strains foreign exchange reserves. Higher imports of staples like sugar and edible oil, combined with declining exports of rice, fruits, and vegetables, mean the country is earning less while spending more on essential food items. This imbalance could pressure the rupee and fuel inflation, particularly if international commodity prices rise. The sharp drop in non-basmati rice exports — historically a competitive product — signals weakening demand and pricing power, while the collapse of vegetable exports highlights over-reliance on a single trade partner, Afghanistan. Meat and fish remain bright spots, but their growth cannot offset the broader decline. What's Next The extended rice subsidy and higher DLTL rates may provide temporary relief for coarse rice exporters, but structural issues — such as access to Afghan markets and international competitiveness — remain unresolved. The government may need to reassess its trade strategy for fruits and vegetables, and explore alternative export destinations. On the import side, continued monitoring of domestic sugar and edible oil supplies will be critical to avoid further price spikes and trade deficits.