Pakistan and the United Arab Emirates (UAE) have strengthened their trade relationship, with total trade between the two countries reaching $10.1 billion during the financial year 2024–25. This marks a 20.24% increase from the previous year, according to the State Bank of Pakistan. The growth shows improved cooperation in key areas such as energy, technology, and investment.
Despite the good news of increased trade, the trade balance remains heavily in favour of the UAE. Pakistan exported $2.1 billion worth of goods and services to the UAE, while imports from the UAE rose to $8 billion. The sharp rise in imports by $1.62 billion has widened the trade gap, raising concerns among economists and policy makers.
Experts believe that while trade growth is a positive sign, Pakistan must take steps to reduce the trade deficit. One hopeful development is the revival of the Pakistan-UAE Joint Ministerial Commission, which met recently after a 13-year break. This move reflects a renewed commitment to work on mutual goals and strengthen economic ties.
To narrow the trade gap, experts suggest that Pakistan should improve its export policies, support local industries, and encourage joint ventures with UAE businesses. By doing so, Pakistan can boost its exports, create more jobs, and attract foreign investment in sectors like IT, manufacturing, agriculture, and renewable energy.
The State Bank has pointed out that there is strong potential for future growth in trade, especially in modern sectors like digital technology, fintech, and clean energy. If Pakistan adopts smart policies and focuses on high-value exports, it could benefit more from its trade relationship with the UAE.
The path forward involves innovation, investment, and smart planning. By focusing on building strong export industries and improving trade policy, Pakistan can reduce the trade gap and gain more from its growing economic partnership with the UAE.
