Pakistan Seeks Trade Talks to Avoid US Tariffs; India-US Trade Deal Possible Before July: Trump
America: Pakistan is actively pursuing trade negotiations with the United States to avert recently proposed 29% tariffs targeting its $3 billion trade surplus. While these tariffs are slated to take effect on July 9, 2025, a 90-day delay is currently in place. Fearing the impact of these tariffs, Pakistani representatives will soon visit the US to negotiate a trade agreement to mitigate the crisis.
Donald Trump's Significant Statement
US President Donald Trump has clarified that, in addition to negotiations with Pakistan, the US is making significant progress towards a major trade agreement with India. Trump stated that negotiations between India and the US are in their final stages, and an agreement could be reached soon. He further warned that the US would cease all trade with either country should a war erupt between them in South Asia.
Pakistan's Attempt to Avoid Tariffs
According to Reuters, Pakistan seeks a trade agreement to avoid the impending US tariffs. The US recently planned new tariffs on several countries, largely due to Pakistan's $3 billion trade surplus. Therefore, Pakistan is attempting to negotiate its way out of these tariffs.
Meanwhile, a trade agreement between India and the US is nearing its final stages. President Trump indicated that both countries are addressing outstanding issues and understanding each other's concerns. Trump stated, "We are very close to making a very good deal with India."
Significance of the Trade Deal for India
This agreement holds significant importance for India. Recently, Commerce Minister Piyush Goyal visited the US to advance trade negotiations. India hopes to sign an interim agreement by early July. The US plans to impose a 26% tariff on India, potentially effective from July 9th. Consequently, India is actively engaged in negotiations with the US to protect its interests.
India aims to provide American companies with investment and business opportunities in the Indian market while simultaneously safeguarding sensitive sectors like agriculture and dairy. Reports suggest India is considering allowing US companies to bid on government contracts worth over $50 billion, potentially strengthening bilateral trade relations.
India-Pakistan Tensions and US Warning
Trump also mentioned the recent clashes between India and Pakistan, involving fighter jets, missiles, drones, and artillery, described as the largest conflict between the two nations in decades. He explicitly stated that any escalation to a war-like situation between India and Pakistan would result in the US ceasing all trade with both countries.
Implications of US-Pakistan Trade Talks
Avoiding the US tariffs is crucial for Pakistan; a 29% tariff would severely strain its economy. Already grappling with an economic crisis and relying on loans from institutions like the IMF, a trade agreement with the US could offer significant relief to Pakistan.
