Islamabad 7 August: Pakistan will not face a projected $1 billion loss due to a revised US tariff policy, Commerce Minister Jam Kamal Khan announced in the National Assembly on Thursday.
The United States has lowered its tariff on Pakistani goods from 29% to 19%, a move expected to enhance Pakistan’s textile exports, a key driver of its economy.
In a written response to the lower house, Khan highlighted that the tariff reduction would likely increase sales of Pakistani products in the US market, particularly in the textile sector, which accounts for a significant portion of Pakistan’s $3 billion trade surplus with the US in 2024. The United States remains Pakistan’s largest market for textile exports.
The tariff adjustment comes as US President Donald Trump implemented a new wave of import duties on August 1, targeting 67 trading partners with rates ranging from 10% to 50%. Pakistan secured a 19% reciprocal tariff, a significant reduction from the previous 29% imposed on its goods. This revision followed a trade agreement finalized between Islamabad and Washington, which both sides hailed as a step toward broader economic and strategic cooperation.
Finance Minister Muhammad Aurangzeb, who led the final negotiations, described the deal as part of a larger partnership with the US. Additionally, President Trump announced a collaborative effort to develop Pakistan’s oil reserves, stating on social media, “We have just concluded a Deal with the Country of Pakistan, whereby Pakistan and the US will work together on developing their massive Oil Reserves.” He noted that discussions are underway to select an oil company to lead the initiative.
The tariff strategy, part of Trump’s broader trade policy, includes national security-based duties on sectors like semiconductors, pharmaceuticals, autos, steel, aluminum, copper, and lumber, with microchip tariffs potentially reaching 100%. While the policy aims to reduce US trade deficits, it has raised concerns about global supply chain disruptions, inflation, and retaliatory measures from trading partners.
