By SKM
February 11, 2026
ISLAMABAD: Pakistan’s textile industry has formally urged the government to initiate talks with the United States for duty-free access on textile and apparel exports made from American cotton, warning that recent trade gains by regional competitors are putting the country’s export share at risk.
In a communication addressed to Commerce Minister Jam Kamal Khan, the All Pakistan Textile Mills Association (APTMA) said shifting global trade arrangements — particularly involving India and Bangladesh — are creating an uneven competitive landscape in the U.S., Pakistan’s largest export destination.
According to the industry body, India has negotiated an 18 percent tariff arrangement with the United States, while Pakistan continues to face tariffs of around 19 percent. Additionally, India has concluded a Free Trade Agreement with the European Union, further strengthening its export competitiveness. Bangladesh, meanwhile, has secured zero-tariff access to the U.S. market for garments and made-ups manufactured using American cotton.
APTMA said these developments pose an “immediate and serious” challenge for Pakistan’s textile sector, which is already operating under high energy tariffs, elevated borrowing costs, heavy taxation and expensive inputs compared to regional peers.
Textiles account for the bulk of Pakistan’s exports and remain a key source of foreign exchange earnings. Industry representatives cautioned that improved market access for competitors — combined with their lower cost structures — could lead to further diversion of orders away from Pakistan.
To counter this trend, APTMA has proposed that the government seek duty-free access from Washington for textile and apparel exports manufactured using U.S. cotton. The association has argued that such a reciprocal framework would also significantly increase imports of American cotton, thereby strengthening bilateral trade ties.
Industry estimates suggest that cotton imports from the United States could exceed $1 billion in 2025, compared to $770 million in 2024, if facilitative measures are introduced. These include removing redundant fumigation requirements, granting a two-year waiver of infrastructure cess on cotton imports — particularly in Sindh — eliminating the Export Development Surcharge on exports produced with U.S. cotton, and engaging U.S. authorities on concessions linked to at least 20 percent American value addition.
APTMA has also proposed establishing dedicated free commercial zones for American cotton to reduce logistics costs and ensure consistent domestic availability.
However, the association noted that revival of domestic spinning activity and higher cotton imports remain contingent upon resolving the sales tax disparity under the Export Facilitation Scheme (EFS), which it described as critical for restoring competitiveness.
Industry leaders have sought an early meeting with the commerce minister, saying timely engagement is essential as global textile trade continues to realign through preferential agreements and strategic supply chain shifts. Ends
