US President Donald Trump’s latest wave of tariffs on exports from dozens of trading partners sent global stock markets tumbling on Friday and countries and companies scrambling to seek ways to strike better deals.
Pakistan, which exported about $4.1 billion worth of apparel to the United States in the 2024 fiscal year, secured a tariff rate of 19%, but industry figures were cautious about the immediate impact.
Pakistan authorities have a point in expressing satisfaction over conclusion of a trade deal with the United States as the outcome of the talks seem to be somewhat favourable to the country if seen in the context of overall approach of the other side to trade issues. The 19% tariff on Pakistani goods is, no doubt, on the higher side if viewed in the context of duties imposed on exports from Pakistan before introduction of higher tariffs by President Trump. However, these are 10% down from 29% that the US President previously slapped on Pakistan and are also considered competitive in relation to other countries of the region as India presently faces 25% duties and Bangladesh and Sri Lanka 20% each. The final decision of the United States vis-à-vis India will make a big difference in terms of potential trade losses or gains for Pakistan. As for Bangladesh and Sri Lanka, Pakistan is unlikely to take any meaningful advantage of the one percent difference as export products of these countries are more competitive because of lower cost of production and taxes. Pakistan can definitely increase its exports to the US provided the Government takes genuine measures to bring down the cost of doing business, exportable surplus is generated and quality is improved to meet the US standards.
