ISLAMABAD: Pakistan’s commerce ministry has finalized a strategy for a recently negotiated tariff agreement with the United States, which Islamabad believes could open doors for significant American investment in the country’s extensive copper reserves. The strategy has been submitted to Prime Minister Shehbaz Sharif for approval, an official confirmed on Tuesday.
The agreement, announced last month by then-US President Donald Trump, introduces a reduced tariff rate of 19 percent on Pakistani imports. The government claims this is the lowest tariff in the region, expected to boost bilateral trade and facilitate US participation in Pakistan’s mining and minerals sector.
Pakistan ranks fifth globally in copper deposits, with major reserves located in Balochistan and Khyber Pakhtunkhwa, positioning the country as a potential major supplier to global markets.
“The commerce ministry has developed a comprehensive strategy covering the tariff deal, focusing on US investment in the mining sector—particularly copper—and has forwarded it to the Prime Minister’s Office,” said Naveed Kallu, public relations officer at the ministry, in an interview with Arab News. “The prime minister will make the final decision, and upon approval, further actions will follow accordingly.”
Kallu highlighted the crucial element of the deal—the US commitment to invest in Pakistan’s minerals sector. He noted that similar agreements with countries like South Korea, Japan, and the UK included reciprocal investments, where those nations invested in the US in exchange for tariff reductions.
“The working group between the US and Pakistan is currently finalizing the operational details, and the American side will recommend companies to export copper from Pakistan,” Kallu added.
Although no memorandum of understanding has been signed yet, negotiations are reportedly progressing positively. The official also mentioned ongoing advanced talks with Middle Eastern companies regarding mineral exports.
In a recent report to the National Assembly, Commerce Minister Jam Kamal Khan confirmed that during tariff discussions, the US expressed interest in investing in Pakistan’s copper mining and processing industries, though no specific companies were named.
He pointed out that while the US has imposed 50 percent tariffs on imports of copper, iron, steel, and aluminum, refined copper is exempt, making value-added copper exports more attractive for Pakistani producers.
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The minister emphasized that by focusing on value-added exports such as refined copper, bars, rods, and alloys rather than raw ore, Pakistan can maximize economic gains from its mineral resources.
He also recommended detailed geological mapping by the Geological Survey of Pakistan (GSP) and improving infrastructure, including mine access roads and dedicated power supplies, to attract private sector investment and facilitate technology transfer.
“Streamlining regulatory frameworks and addressing infrastructure gaps will encourage private sector involvement and foster technological innovation,” the statement said.
Arab News reached out to the US Embassy in Islamabad, the US Commerce Department, and the GSP for comments but received no responses before publication.
Industry experts say Pakistan’s mineral wealth remains underutilized due to the lack of refineries and quality-testing facilities.
“Pakistan has abundant mineral reserves, including copper, but lacks proper refineries to process them,” said Meer Behrose Regi, president of the All Pakistan Mines & Minerals Association. He added that with adequate investment in refinery infrastructure, Pakistan could export high-quality finished products instead of raw materials.