Pakistan Exporters Downplay New US Duty Risk

Pakistan’s export community has played down immediate fears over a proposed additional 10 percent United States duty, arguing that the measure is unlikely to cause a sudden disruption in shipments from the country. The issue gained attention on June 4 as exporters in Karachi assessed Washington’s latest tariff move and its possible effect on Pakistan’s trade outlook.

The development comes after the United States Trade Representative proposed fresh duties on imports from several economies, including Pakistan. The proposal is part of a wider trade action involving multiple countries and has raised questions for Pakistani manufacturers already dealing with high production costs, energy prices and regional competition.

Exporters say the direct burden of the duty would fall on buyers in the American market, because duties are generally paid after goods arrive in the United States. However, they also acknowledge that any rise in landed cost can make Pakistani products more expensive for end consumers and weaken competitiveness if rival suppliers face lower cost structures.

Javed Bilwani, a prominent exporter and former president of the Karachi Chamber of Commerce, said Pakistani textile products already face significant duties in the US market. He noted that the additional duty has pushed the total cost pressure higher and argued that the latest move appears designed to keep the tariff structure in place after earlier legal challenges to Washington’s broader trade regime.

The concern is not limited to the headline duty rate. Pakistani exporters have long complained that their goods are more expensive than those of competitors because of high energy tariffs, costly financing and expensive imported inputs used in manufacturing. These domestic cost pressures reduce the room for exporters to absorb any external tariff shock or offer discounts to foreign buyers.

The United States remains one of Pakistan’s most important export destinations, especially for textiles and apparel. State Bank data cited in the report shows exports to the US during July-April FY26 stood above $5 billion, slightly higher than the same period of the previous year. Full-year exports to the US also improved in FY25 compared with FY24.

At the same time, Pakistan’s imports from the United States have also increased, though they remain well below export levels. This means the bilateral trade balance continues to favour Pakistan, making any change in US tariff policy particularly important for exporters, policymakers and foreign exchange managers.

Textile exporter Amir Aziz warned that if the extra duty continues beyond its expected deadline, Pakistan could face a more serious challenge in the US market. He argued that Pakistani goods are already among the costliest in the region, while competitors benefit from lower manufacturing expenses and more supportive business conditions.

For Pakistan’s economy, the issue is significant because exports are central to foreign exchange earnings, industrial employment and overall balance-of-payments stability. Even if exporters do not expect an immediate collapse in orders, a prolonged tariff burden could reduce price competitiveness, slow export growth and add pressure on the government to address domestic production costs.

The next step will depend on how Washington finalises its tariff approach and whether the additional duty remains in force after the current timeline. Pakistani exporters are expected to keep pressing Islamabad for cheaper energy, lower borrowing costs and policy support so that the country can defend its position in the US market despite external trade pressure.