Pakistan and the United States are close to finalizing a comprehensive trade and investment agreement, with Islamabad anticipating a significant increase in its exports. In exchange, however, Washington is seeking reciprocal incentives for its investments in Pakistan’s mines and minerals sector, according to official sources who spoke to The News on Friday.
When asked about the deal, Finance Minister Muhammad Aurangzeb told The News that he expects the agreement to be finalized in the coming weeks, anticipating a boost in Pakistan’s exports. An official source added that more than 90% of the deal’s terms have been agreed upon, but certain details are still being discussed, such as how Pakistan will incentivize US investment in its mines and minerals.
One potential consequence is that Pakistan’s procurement of POL (Petroleum, Oil, and Lubricants) products from the US could lead to higher prices for domestic consumers due to increased logistics costs. However, officials stated that the impact would be minimal, as US imports would only constitute about 10% of Pakistan’s total POL imports.
To prepare for the agreement, two of Pakistan’s key ministers, Minister for Commerce Jam Kamal and Special Assistant to the PM on Industries Haroon Akhtar Khan, met with exporters last week to gather their feedback on US tariffs.
In a separate development, a statement released on Friday confirmed that US Chargé d’Affaires Natalie Baker met with Finance Minister Aurangzeb. During the meeting, they discussed ways to enhance bilateral trade, commerce, and US investment in Pakistan. Aurangzeb highlighted that Pakistan’s economy had “turned the corner” and cited a recent upgrade by Moody’s as evidence that the government’s reforms were yielding positive results. He thanked the US for its support and recalled his recent constructive engagements in Washington, D.C., to finalize the trade agreement.
The minister expressed hope that the deal would usher in a new era of economic collaboration, especially in sectors like energy, mines and minerals, IT, and cryptocurrency. He also believes it will expand market access, attract investment, and foster cooperation in areas of mutual interest, leading to increased US investment in Pakistan’s infrastructure, development, and mining sectors.
Baker, in turn, acknowledged that the agreement presents a significant opportunity for both countries to expand bilateral trade. She noted that US companies are showing strong interest in investment and entrepreneurial opportunities in Pakistan, particularly in supply chain management, production, project management, energy, critical minerals, mining, and oil exploration. Both sides reaffirmed their commitment to work together to advance these initiatives, ensuring mutually beneficial outcomes and strengthening economic cooperation.
