Pakistan has decided to take a reconciliatory approach to US President Donald Trump’s decision to impose a 29% additional tariff on its goods, with the Pakistani ambassador and trade minister expected to meet US officials this week to discuss the matter, The Express Tribune reported.
Unlike many nations that have escalated the trade conflict by imposing counter-tariffs, Pakistan aims to engage in dialogue and explain its position.
The US decision, announced by President Trump on Wednesday, targeted 60 countries, including Pakistan, as part of efforts to reduce the trade deficit and promote American-made goods.
The move came as a surprise to Pakistani authorities, who noted that the US already charges higher trade-weighted average tariffs on imports from Pakistan than Pakistan imposes on US goods.
According to the Ministry of Commerce, the US charges a 9.9% tariff on Pakistani goods, compared to Pakistan’s 7.3% tariff on US imports.
Pakistan’s exports to the US reached $3.9 billion during the July-March period of FY 2024-25, a 15% increase from the previous year, resulting in a trade surplus of $3 billion. However, this surplus is relatively small compared to the larger trade surpluses enjoyed by 32 other countries.
The US has applied the additional tariffs based on a formula that connects trade deficits with tariffs, with the result being a 29% tariff on Pakistan.
The imposition of these tariffs has raised concerns in Pakistan, particularly regarding the impact on major exports like garments, which now face tariffs as high as 49%.
As per the news report, in a high-level meeting chaired by Finance Minister Muhammad Aurangzeb on Thursday, attended by key government officials, it was decided that Pakistan’s embassy in Washington would request a meeting with US trade representatives. Pakistan’s ambassador and trade minister are also expected to meet with US officials this week to discuss the matter.
Pakistani officials are hopeful that they can present a strong case to have the decision reviewed. Despite the higher tariffs, Pakistan sees an opportunity to increase textile exports, as tariffs on countries like China, Vietnam, and Sri Lanka are also rising, although it may face stiff competition from countries such as India, Vietnam, Egypt, and Turkey.
Despite the challenges posed by the new US tariffs, Pakistan’s authorities believe there may still be opportunities for growth in specific sectors like textiles, provided they can secure a more favorable tariff environment.