US President Donald Trump has been talking a lot about the imposition of higher tariff rates on trade with various countries, both in terms of imports into and exports from the USA.
In the process, he has been unsettling America’s trade relations globally in a rather hush-hush manner. According to economic experts, this global trade turmoil is likely to spare Pakistan and even offer it some benefit. The intensifying US tariff war under President Trump’s renewed economic policies has clearly marked a significant shift in the international trade landscape. While many countries are grappling with concerns over economic fallout, the evolving situation has brought not only risks but also opportunities for Pakistan with regard to its exports.
Pakistan ranked 13th in terms of its trade surplus with the USA. Exports to the US made up only 17 percent of Pakistan’s total global exports. The country is now emphasizing trade and investment over aid, as envisioned by the federal government of Prime Minister Shehbaz Sharif. Pakistan is already a major trading partner of the European Union (EU), China and several Middle Eastern and Far Eastern countries. As such, its trade is unlikely to be adversely affected by US tariff actions, allowing it to maintain trade ties even as larger economies face pressure.
Pakistan’s lower reciprocal tariffs make it a more accessible market for the USA and strengthen its case for preferential treatment. Although Pakistan has imposed a 7.3 percent trade-weighted average tariff on US goods—compared to the US’s 9.9 percent on Pakistani exports—Washington’s formula has resulted in 30 percent additional tariffs on Pakistani goods. Still, Pakistan’s rate of 30 percent remains lower than several competitors and close to India’s 27 percent. This relatively open market profile supports Pakistan’s position as a competitive and open trading partner and strengthens its call for improved US market access.
It is worth noting that President Trump has recently hinted at boosting trade ties with Pakistan. In line with this, US Secretary of State Marco Rubio called Prime Minister Shehbaz Sharif a few days ago to discuss Pak-US relations, especially regarding enhanced trade. The PM, in turn, agreed to work closely to further strengthen bilateral ties, particularly through expanded trade. In a welcome development, a Pakistani delegation has already visited Washington and held useful, productive discussions with relevant US authorities—an encouraging sign for the future of Pak-US trade relations.
Cotton trade forms the backbone of US-Pakistan textile cooperation. Pakistan is one of the largest importers of US cotton, a vital input for its leading export sector: textiles and apparel. In FY 2024, Pakistan imported over US $700 million worth of raw cotton—the largest import item from the US. Experts expect this figure to rise in the coming months. By sourcing high-quality cotton from the US and exporting value-added finished goods, Pakistan has developed a mutually beneficial trade cycle. This has boosted industrial competitiveness and secured long-term access to the US market.
The federal government is currently consulting with the private sector to devise policies aimed at increasing cotton imports from the US, thereby further solidifying Pakistan’s role as a reliable textile supplier and anchoring bilateral trade. Pakistan is also considering proposals to import soybeans and beef products from the US, which would further enhance trade with one of the world’s largest markets.
In brief, trade diversions from China and other major US partners are expected to open new export opportunities for Pakistan. The most promising opportunities lie in product categories that the US imports in large volumes from high-tariff countries where Pakistan already has some presence. These include textiles and apparel—particularly cotton trousers, knit shirts and denim—where Pakistan can capitalize on its strong textile base.
Declining oil prices in the international market are also providing some relief to Pakistan’s economy, which is reportedly on a positive upward trajectory according to official data. This adds momentum to Pakistan’s position as a growing economy well-placed to seize new trade opportunities.
In conclusion, Pakistan finds itself at a rare juncture amid the turbulence of the US-led trade war—largely insulated from direct fallout, yet well-positioned to benefit. As global supply chains are reshaped and trade patterns recalibrated, Pakistan can position itself strategically through foresight, smart diplomacy and targeted investments. Experts believe that with the right policy mix, Pakistan—already in engagement with US authorities—can resolve the issue of additional tariffs through mutual consultation and negotiations. Both the federal government and the private sector remain optimistic about reaching a positive and mutually beneficial outcome.
—The writer is a Lahore-based freelance journalist, columnist and retired Deputy Controller (News), Radio Pakistan, Islamabad.
(zahidriffat@gmail.com)
