By Staff Reporter
ISLAMABAD: Pakistan and the United States have concluded a critical round of trade negotiations, reaching an understanding on an agreement that could prevent the re-imposition of a 29 percent tariff on Pakistani exports, Dawn newspaper reported on Saturday.
With a July 9 deadline looming, the deal could safeguard billions in bilateral trade and bolster economic ties strained since the Trump administration slapped retaliatory tariffs on Islamabad.
A Pakistani delegation, led by Commerce Secretary Jawad Paal, wrapped up four days of talks in Washington on Friday, laying the groundwork for a long-term reciprocal tariff arrangement. The delegation arrived Monday, intent on securing a pact before the tariff relief, temporarily paused earlier this year, expires next week.
A formal announcement is expected once the US finalises similar negotiations with other trade partners, according to Dawn newspaper.
The stakes are high for Pakistan, which sends over a third of its exports to the US, its largest single-country market. President Donald Trump imposed the 29 percent tariff on April 2, in response to Pakistan’s 58 percent duty on American imports.
Combined with a pre-existing 10 percent levy, the total tariff on Pakistani goods stands at 39 percent, a punishing rate for an export sector dominated by textiles and agricultural products.
Media reports estimate the tariffs could slice $500 million to $700 million from Pakistan’s export revenues if reinstated.
The US accounted for 18 percent of Pakistan’s total exports in the latest fiscal year, with textiles making up nearly 90 percent of shipments. In contrast, the US represents just 4.5 percent of Pakistan’s imports, highlighting a stark trade asymmetry.
In 2024, the US imported $5.44 billion in Pakistani goods, while exports to the US climbed 10 percent year-over-year to $4 billion in the first eight months of the current fiscal year, amplifying the urgency of the talks.
Under the proposed deal, Pakistan could ramp up imports of US goods, particularly crude oil, while opening the door to American investment in its mining, energy, and infrastructure sectors. The Reko Diq copper and gold mine project emerged as a key focus, alongside potential financing from the US Export-Import Bank.
Pakistani officials pressed for an early resolution to dispel uncertainty clouding exporters and investors, even as US Treasury Secretary Scott Bessent had signaled possible flexibility on the deadline if progress was clear.
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