U.S. President Donald Trump has lowered Pakistan’s import tariff rate to 19% from 29%, effective August 7, 2025, following a trade agreement finalized on July 31.

The decision, announced via an executive order, comes a day after Trump hailed a “landmark energy partnership” with Pakistan to develop its oil reserves, signaling a new chapter in U.S.-Pakistan economic ties.

The tariff reduction stems from negotiations that addressed Pakistan’s $3 billion trade surplus with the U.S. in 2024, driven largely by textile exports.

Pakistan faced a 29% tariff in April 2025 under Trump’s initial “Liberation Day” policy, which targeted 69 countries to correct trade imbalances.

The new 19% rate, secured after talks led by Pakistan’s Finance Minister Muhammad Aurangzeb, enhances market access for Pakistani goods, particularly textiles, leather, and surgical instruments.

The move positions Pakistan favorably compared to regional neighbors like India (25%) and Bangladesh (20%) under Trump’s reciprocal tariff regime.