ISLAMABAD, Pakistan – August 7, 2025 – In a move signaling a “renaissance” in U.S.-Pakistan relations, the two nations have finalized a new trade agreement that sets a uniform tariff of 19% on Pakistani goods exported to the United States. This marks a significant reduction from the previous 29% tariff and is poised to substantially boost Pakistan’s exports, particularly in the textile sector.
Commerce Minister Jam Kamal Khan announced that this new rate is the lowest for any country in the South Asian region and effectively prevents Pakistan from suffering a potential $1 billion loss that was initially feared due to new U.S. tariffs. The U.S. is Pakistan’s largest market for textiles, and this agreement is expected to strengthen the country’s trade surplus with Washington, which stood at approximately $3 billion in 2024.
The trade deal is part of a broader strategic partnership that includes a pact for U.S. and Pakistan to collaborate on developing Pakistan’s oil and mineral reserves. This renewed “bonhomie” with the U.S. has been noted by analysts as a well-choreographed diplomatic effort, with Pakistan’s government successfully engaging a “relentlessly transactional administration.”
Further demonstrating the warming ties, a Senate delegation from Pakistan is scheduled to visit the U.S. to meet with officials and business leaders to deepen legislative and economic relations. The government has also stated that there is no shortage of life-saving medicines and has increased funding for social welfare programs, including a 21% increase for the Benazir Income Support Program.
You May Like To Read:
