The ongoing trade wars and tariffs imposed by the United States on China are expected to redirect export orders toward competitive markets like Pakistan, as stated by AKD Securities Limited in their Pakistan Strategy Report 2025.

AKD Securities highlighted that the textile and export-oriented sectors in Pakistan are likely to play a significant role in driving energy demand. This shift comes as the U.S. and Europe continue to impose tariffs on Chinese imports, encouraging businesses to explore alternative markets like Pakistan.

Recently, President Donald Trump announced a 10 percent tariff on all Chinese imports, signaling the start of a new trade war, according to many economists. Trump also mentioned that the European Union might be his next target for higher tariffs, though no timeline has been provided yet.

AKD Securities also warned that these tariffs and restrictions imposed by the newly elected administration in the U.S. could negatively impact Pakistan’s exports, potentially widening the trade deficit. The pressure on currency stability may increase as export revenues decline, and foreign exchange reserves come under strain.

The report further noted that U.S.-led restrictions on China could pose challenges for the China-Pakistan Economic Corridor (CPEC), potentially disrupting trade and infrastructure projects and complicating diplomatic and economic relations between the involved countries.

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