PAKISTAN’S TRADE POLICY: A JOURNEY OF EVOLUTION AND AMBITION FROM 2002 TO 2025

Abstract

The trade policy of Pakistan has witnessed an important change in the last twenty years, as it is going towards a more liberalized and market-oriented policy. The systematic review of the research looks into the changes of the trade policy of Pakistan between 2000-2025 major policy shifts explored, and trades liberalization initiatives, Strategic Trade Policy Frameworks (STPFs), etc. The study uses a qualitative analysis of policy documents and quantitative analysis of trade data to assess the usefulness of these policies in promoting exports competitiveness and the trade deficit. The results reveal that despite Pakistan managing to lower tariff rates and adopting a number of export promotion activities, problems with structure, which include high business set up costs, low product diversification and poor engagement into value chains, still curtail trade performance. Existing non-tariff barriers and regulation distortions also impede full utilization of opportunities by the country on the global front. Noting that policy changes have improved the export performance, the author notes that exports in Pakistan are still firmly embedded in traditional areas, and there has been continuity in lack of implementation, further eroding the possible advantages of trade liberalization. The authors sum up that Pakistan has so far delivered significant achievements in its trade policy, but stronger institutional reforms, greater deeper efforts in trade facilitation, and specific strategies to participate in the global value chain is needed to achieve lasting export-oriented economic growth.