Lawmakers in Islamabad have decided to send a high-profile delegation to the United States (US) to go over the tariffs that US President Donald Trump has levied on Pakistani goods entering the US. As per credible reports, the delegation intends to boost trade volume between the two economies.

 

This move was authorised by Prime Minister (PM) Shehbaz Sharif as the government grew worried about a potential drop in export volume to the US. Pakistan, along with several other countries, has been slammed by tariffs.

 

The situation is alarming for Pakistani exporters as their goods will now face a 39 percent tariff once they reach the US’s shores. Pakistan’s tariff is comprised of a country-specific rate of 29 percent and a baseline rate of 10 percent - which was unilaterally imposed on all countries. This has caused the competitiveness of Pakistani exports to shrink in the international market.

 

While many consider this move to be hostile by the US, analysts have outlined how Pakistan itself has historically levied high tariffs against the US. Currently, Pakistan has a 58 percent tariff rate against all US products entering the country.

 

Facing falling competitiveness because of taxes, PM Shehbaz Sharif has authorised the Pakistani delegation to draw up a framework that can protect Pakistan’s commercial interests.  As per reports, the Pakistani delegation consists of several exporters and business leaders. If successful, the delegation may secure better terms with its largest single-country export destination: The United States.  

 

Data from reports suggests that the value of exports to the US stand at a respectable $6 billion, which are now under threat. These exports are primarily textiles, causing many business owners to evaluate the confidence they had placed in the textile sector.

 

Projections from analysts indicate that the aforementioned developments could result in Islamabad's failure to realise approximately $500 to $700 million in duties. While it might seem like a small amount at first glance, many believe that the effects could be devastating for the cash-strapped economy.

 

Reports have revealed that PM Shehbaz Sharif is willing to work with the Trump administration to attain a better deal for Pakistan. This is because the decision to send a team to the US came mere hours after the Pakistani premier held a meeting with senior officials from the US.

 

During this meeting, PM Sharif outlined Pakistan’s willingness to cooperate with the US in matters pertaining to trade, investment, counter-terrorism and regional security.