US-Pakistan trade talks continue as industry seeks lower export tariffs

LAHORE: Pakistan and the United States are continuing high-level trade negotiations in Washington aimed at advancing a reciprocal trade agreement, as both countries seek to strengthen bilateral commerce, address tariff-related issues and build a more durable economic partnership.

The negotiations come as temporary US tariff measures are set to expire later this month, placing added focus on efforts to improve market access and provide greater certainty for exporters and investors. The talks also reflect the broader momentum in Pakistan-US economic relations, with both governments increasingly emphasizing trade, investment and commercial cooperation as key pillars of bilateral engagement.

Growing trade ties underscore the importance of the negotiations. According to the Office of the United States Trade Representative, total US goods and services trade with Pakistan reached an estimated $10.1 billion in 2024, up 6.3% from the previous year. US goods trade totaled $8.7 billion in 2025, with US exports to Pakistan increasing 56.6% to $3.3 billion, while imports from Pakistan rose 5.9% to $5.4 billion, narrowing the US goods trade deficit with Pakistan by nearly 30%. US services trade totaled an estimated $2.9 billion in 2024, reflecting continued expansion in commercial relations.

In a post on X earlier this week, Foreign Office Spokesperson Tahir Andrabi said negotiations on the Pakistan-United States Agreement on Reciprocal Trade were being held in Washington on Thursday and Friday.

Andrabi said the Pakistani delegation was led by Commerce Secretary Jawad Paul and included Secretary Overseas Pakistanis and Human Resource Development Nadeem Chaudhary, Joint Secretary Tariff Policy Mohammad Ashfaq and officials from the Ministry of Foreign Affairs, while representatives of other ministries were participating virtually.

"The talks aim to further strengthen Pakistan-US trade relations, facilitate bilateral trade as a driver of economic cooperation, and pave the way for the diversification and expansion of existing trade," Andrabi said.

The negotiations come as Pakistan seeks greater access to its largest single-country export market while both sides work toward replacing temporary trade measures with a more stable bilateral framework.

According to Lahore Chamber of Commerce and Industry President Faheem Ur Rehman Saigol, a successful outcome would provide Pakistani exporters with greater market access through lower tariffs, particularly for textiles, apparel, surgical instruments, sports goods and information technology services.

Talking to Pakistan TV Digital, Saigol said Pakistan should use its improving diplomatic engagement with Washington to secure stronger economic outcomes.

“Pakistan should leverage its constructive diplomatic engagement and regional importance to secure economic benefits,” Saigol said. "We expect negotiations to focus on enhancing bilateral trade, attracting US investment, and removing non-tariff barriers that hinder Pakistani exports.”

"A mutually beneficial agreement should improve Pakistan's export competitiveness, create employment opportunities, and strengthen long-term economic cooperation between the two countries while ensuring a more balanced and sustainable trade relationship," he added.

The negotiations follow more than a year of evolving US trade measures affecting Pakistani exports. In April 2025, President Donald Trump invoked the International Emergency Economic Powers Act (IEEPA) to impose a proposed 29% tariff on Pakistani exports as part of broader global trade measures. Following negotiations between Pakistani officials and the Office of the United States Trade Representative, the proposed tariff was reduced to 19%.

The tariff landscape shifted again in February after the US Supreme Court ruled that the IEEPA did not authorize the president to impose broad tariffs under the emergency law, effectively invalidating the measure. The Trump administration subsequently invoked Section 122 of the Trade Act of 1974 to impose a temporary 10% global tariff for up to 150 days, a measure scheduled to expire on July 24.

Pakistan is also among nearly 60 economies subject to Section 301 investigations by the Office of the United States Trade Representative concerning forced labor-related trade practices. Islamabad has submitted detailed responses to the USTR, including an additional submission ahead of the latest negotiations. Under the USTR proposal, Pakistan would face an additional 10% tariff under the Section 301 process, while most other investigated economies would face proposed duties of 12.5%.

The ongoing negotiations are widely viewed as an opportunity to resolve outstanding tariff issues, deepen bilateral trade and establish a more predictable framework for long-term economic cooperation between Pakistan and the United States.