EXPORTS for the last financial year are now estimated at $16.4 billion against a $17 billion target. Normally, such a shortfall should not be a cause for concern. But given the unsustainable trend in foreign trade, with exports outpaced by a massive rise in imports, the issue has become worrisome. Two areas of major concern surfaced last year. Growth slowed down from 20.9 per cent during July 2005-January 2006 to an average monthly rate of 10.5 per cent in February-May 2006.This sharp decline has also caused the trade deficit to surge to about $11 billion. Despite the doubling of export earnings over the past seven years, the export-GDP ratio is at a low 13 per cent and Prime Minister Shaukat Aziz wants it to be raised to 15 per cent. All this requires the policymakers to reappraise their strategy for exports whose growth is also subject to structural and cyclical factors. The withdrawal of the textile quota from January 1, 2005, has turned Europe and the United States into a saturated buyers’ market. Although textiles contributed over 61.4 per cent of the increase in exports last year, nearly 90 per cent of it was on account of the higher quantity of products. Exports have been hit by a falling unit value of key commodities.