Pakistan to seek zero-tariff access from China on 700 product lines under FTA talks

Pakistan is set to formally ask China to extend unilateral tariff concessions on around 700 product lines under the proposed third phase of the China-Pakistan Free Trade Agreement (CPFTA), as Islamabad seeks tariff treatment similar to concessions granted to ASEAN and African countries, Business Recorder reported. 

According to officials, Commerce Minister Jam Kamal Khan and Commerce Secretary Jawad Paul are currently in Beijing to finalise proposals with Chinese counterparts ahead of Prime Minister Shehbaz Sharif’s visit.

Pakistan exported goods worth $2.375 billion to China during FY2024-25, of which $2.16 billion fell under the existing free trade agreement framework. However, Pakistan continues to face a large trade imbalance with China, with annual imports standing near $20 billion against exports of around $2 billion.

Officials said China’s exports to Pakistan exceeded $100 billion over the last five years, while Pakistan’s exports to China remained close to $10 billion during the same period.

The government believes the imbalance is linked to Pakistan’s export structure, which mainly consists of raw materials such as copper and cotton that are later re-imported as higher-value finished goods.

Negotiations under the proposed third phase of the free trade agreement are currently focused on improving market access for Pakistani products, particularly textiles, minerals and meat products.

Officials estimate Pakistan’s meat exports alone have a potential of around $5 billion.

According to sources, more than a dozen Sanitary and Phytosanitary and Technical Barriers to Trade protocols have already been signed during the discussions.

Pakistan is also seeking additional facilitation measures, including establishment of a “Green Channel” at the Khunjerab Pass border crossing to improve trade flows.

China granted unilateral zero-tariff access to 53 African countries from May 1, 2026, while ASEAN member states continue to benefit from preferential tariff arrangements.

Pakistani officials argue that concessions secured under earlier phases of the China-Pakistan Free Trade Agreement have been diluted due to China’s subsequent agreements with ASEAN countries and other preferential trade arrangements.

Sources said Prime Minister Shehbaz Sharif has been briefed to strongly advocate for the concessions during meetings in Beijing.

Pakistan is also expected to request waiver of the existing 1% import duty on rice exports to China and seek a special import quota arrangement similar to the facility granted during 2019-20.

In addition, Islamabad plans to ask Beijing to encourage Chinese state-owned enterprises, particularly COFCO, to enter into long-term procurement agreements with Pakistani rice exporters.

Officials said Pakistan would also seek easier visa issuance for Pakistani exporters and businessmen to improve commercial engagement with Chinese markets.

Both countries are currently operating under Phase-II of the China-Pakistan Free Trade Agreement, which was implemented in January 2020.

According to officials, bilateral trade between Pakistan and China stood at approximately $19.4 billion during FY2024-25, with Pakistan’s trade deficit accounting for nearly 59% of the country’s overall trade gap.