Pakistan looking to sign a free trade agreement with the US. The country is trying to get preferential market access to the United States. Pakistan has been formulating this strategy after the United States decided to strip India of its preferential market access that exempted Indian exports worth billions of dollars from American tariffs.

Pakistan was the 55th largest supplier of goods to the United States in 2017 with total exports worth $3.6 billion, while imports from the US were $2.8 billion in the same period. Pakistan’s main exports to the US include textile articles, knit apparel, woven apparel, leather products, cotton, and agricultural products.

As a first step Pakistan is increasing its production and value addition. Lucrative incentives will be offered to local and foreign investors to set up new industries to increase the country’s production line for exports and capture the international market with quality goods. Pakistan has been benefitting from tariff preferences (mostly zero duties on two-thirds of all product categories) under the Generalized Scheme of Preferences (GSP) Plus arrangement awarded by the European Union since January 2014. This has helped Islamabad increase its exports by 13 per cent so far. However, there is no guarantee that the US’ abolishment of preferential market access to India will automatically benefit Pakistan.