Pakistan’s Commerce Minister, Jam Kamal Khan, informed the National Assembly on Thursday that Pakistan will not suffer a loss of $1 billion due to the United States’ imposition of a 19% tariff. In his response to the lower house of parliament, the minister stated that the US has actually reduced the tariff on Pakistani goods from 29% to 19%.
Khan maintained that this reduction in tariff will boost the sale of Pakistani products in the US market and is likely to increase the country’s textile exports.
This clarification comes as new higher tariff rates from US President Donald Trump, ranging from 10% to 50%, came into effect on Thursday for dozens of trading partners, including Pakistan. The move is part of Trump’s strategy to shrink US trade deficits without causing massive disruptions to global supply chains or triggering significant retaliation.
Earlier this month, Trump had announced a new wave of steep import duties, targeting numerous countries with a 19% reciprocal tariff on Pakistan ahead of an August 31 deadline. This was a revision of the previous 29% tariff on Pakistani goods after the two countries finalized a trade agreement.
Islamabad has described the deal as a sign of a broader partnership with Washington. Finance Minister Muhammad Aurangzeb, who led the final round of talks, mentioned a larger economic and strategic agreement. Meanwhile, Trump touted a separate pact to help develop Pakistan’s oil reserves, writing on social media, “We have just concluded a Deal with the Country of Pakistan, whereby Pakistan and the US will work together on developing their massive Oil Reserves.”
In 2024, Islamabad’s trade surplus with Washington was approximately $3 billion, primarily driven by textile exports. The United States is Pakistan’s largest market for textiles. Trump’s July 31 tariff order imposed duties above 10% on 67 trading partners, while the rate remained at 10% for others. These import taxes are part of a multilayered strategy that also includes sectoral tariffs on goods like semiconductors, pharmaceuticals, and steel.
