- Both sides make significant progress in trade talks, with a formal announcement expected after the US concludes negotiations with other trade partners
Pakistan and the United States have reached an agreement on a trade and tariff deal framework, just days before the July 9 deadline set by President Donald J. Trump. This marks a significant development in the ongoing trade negotiations between the two nations, Dawn reported.
While Pakistan and the US representatives have made significant progress in trade talks, a formal announcement is expected only after the US concludes ongoing negotiations with other trade partners.
The Pakistani delegation, led by Commerce Secretary Jawad Paal, concluded four days of talks in Washington on Friday.
The main objective of the talks was to finalise a long-term reciprocal tariff agreement that would prevent the re-imposition of a 29% tariff on Pakistani exports, primarily textiles and agricultural products.
The tariff relief, which had been temporarily paused earlier this year, was at risk of expiring if no deal was finalised by the July 9 deadline. If no agreement is reached, the 29% tariffs could be reinstated, potentially jeopardising $5 billion in Pakistan’s annual exports to the US.
Pakistan’s finance think tanks have warned that this could lead to a 20–25% drop in exports, resulting in a $1–1.4 billion revenue loss.
Dawn reported, citing sources, that both sides have agreed on a broad framework, with the deal paving the way for increased Pakistani imports of US goods, particularly crude oil, and for potential American investment in Pakistan’s mining, energy, and infrastructure sectors.
The discussions also focused on projects such as the Reko Diq copper and gold mine.
US Treasury Secretary Scott Bessent had previously suggested that Washington might allow some flexibility on the deadline if meaningful progress was made, but Pakistani officials have pressed for an early completion of the deal to eliminate uncertainty for exporters and investors.
Officials remain optimistic that the agreement will help maintain Pakistan’s access to the US market and reset bilateral economic relations, which have been strained due to high tariffs introduced during the Trump administration.
Meanwhile, India is also engaged in trade negotiations with the US, aiming to finalise an interim trade deal by the July 9 deadline. India is negotiating tariff reductions, particularly in areas like dairy, poultry, and ethanol, but it has drawn a firm line around its agricultural sector, concerned about the impact on its rural economy.
In the case of Bangladesh, US-Bangladesh trade talks concluded in early July with no major decision, although a follow-up meeting is scheduled for July 8. In 2024, total US-Bangladesh trade was valued at $10.6 billion, with the US facing a trade deficit of $6.2 billion.
