Exports to US to face 19pc tariffs

ISLAMABAD: Pakistani exports to the US would face 19 percent tariffs (as opposed to the forgoing less than 10 percent) from the initially proposed 29 percent by President Trump, so noted the official statement released by the Finance Ministry, however there was no mention of reciprocal tariffs on US exports to Pakistan.

On Business Recorder’s query to Director General Media of Finance Ministry on any reciprocal tariffs that may be imposed on US exports to Pakistan, he stated that “the Commerce Ministry was leading the technical discussion during the Pak-US talks. The delegation is currently travelling and would provide further details once it returns to the country.”

Pakistan on Friday termed the trade deal a ‘balanced and forward-looking approach’ by the US authorities and further contended that the agreement keeps Pakistan competitive relative to other South and Southeast Asian countries and this tariff level is expected to support Pakistan’s export potential, especially in key sectors such as textiles, which remain the backbone of the country’s export economy.

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Executive Order dated 31st July 2025 issued by the White House titled ‘Further Modifying the Reciprocal Tariff Rates’ noted Pakistan will face lower tariffs than other regional competitors including India 25 percent, Bangladesh and Sri Lanka at 20 percent. However, no other regional country, including India and China, has reached a trade agreement with the US yet.

The countries that have reached an agreement, apart from Pakistan include the UK (10 percent tariffs against the proposed 25 percent), Vietnam (20 percent against 46 percent originally proposed), Indonesia (19 percent against 32 percent proposed), Philippines (19 percent against 20 percent proposed), Japan (15 percent against 25 percent proposed), EU (15 percent against 30 percent) and South Korea (15 percent against 25 percent).

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The statement further noted that the Ministry of Finance, in close coordination with relevant stakeholders, believes that the current tariff arrangement presents a significant opportunity to expand Pakistan’s footprint in the US market. It is now essential for Pakistani exporters and trade bodies to adopt an aggressive and focused marketing strategy to capitalize on this development.

In addition to textiles, there is substantial potential for growth in other sectors, and the government is committed to facilitating exporters through policy support, market intelligence, and trade promotion initiatives.

“The government of Pakistan looks forward to further positive engagements and close cooperation with the United States in the areas of investment, artificial intelligence, crypto currency, mines & minerals, energy, and other emerging sectors. Pakistan will continue to engage closely with President Trump and the US administration to promote the shared goals of economic development and mutual prosperity,” the statement noted.

Pakistan exports to the US were $6.028 billion in fiscal year 2024-25 against exports of $5.444 billion in 2023-24. The imports from the US into the country during last fiscal year were recorded at $2.350 billion against $1.875 billion in 2023-24.

Copyright Business Recorder, 2025