Pakistan pays as high as 22 percent tariff and as little as 12 percent on some textile exports to the United States of America (USA), sources told Business Recorder. "If the United States lifts trade restrictions and gives free access to Pakistani textile products, it would result in a $5 billion increase in textile exports", sources said.
Pakistan government is lobbying for abolishment of textile tariff which would enable the textile sector to increase exports to the US market. Senior US officials have, time and again, pledged to work towards greater market access for Pakistan's textile products in the US market and to advance bilateral trade and economic ties. However, there has been no progress in this regard.
Sources said that high tariff imposes a significant strain on an industry that is crucial to Pakistan's economy. Lifting tariffs on Pakistan's textile products would undoubtedly boost the country's economy. The textile sector employs nearly 40 percent of Pakistan's industrial labour force and accounts for 60 percent of its exports, and the US is one of Pakistan's biggest markets.
Officials further said that Pakistan exports about $10 billion worth of textile products each year, with about a quarter of that amount going to US. Currently, the US has several concessional and duty-free agreements with about 80 countries including Free Trade Agreements (FTA), the Central America-Dominican Republic-United States Free Trade Agreement (CAFTA-DR) and the North American Free Trade Agreement (NAFTA). US imports to the tune of $120 billion from different countries with Pakistan's share at only $2.5 billion.
The USA has placed tariffs on Pakistan's textiles which are 3 times the rate applied to most other countries, Bruce Riedel reports in his article 'Three ways to help Pakistan', published by Newsweek magazine in its July 8 edition. Bruce Riedel further added that level playing field for Pakistan's products is a national security imperative for the United States. Instead, Washington places tariffs on Pakistan's textiles that are three times the rate applied to most countries. "A level playing field for Pakistani products is a national security imperative for America, even if our own textile industry hates it," he added.