Pakistan and the US finalised a trade deal on Wednesday night, expected to lower tariffs — although no figure was announced — while US President Donald Trump cited a pact aimed at helping develop Pakistan’s oil reserves.

Finance Minister Muhammad Aurangzeb is currently in Washington for negotiations on a tariff deal and also began meetings with senior US officials on Wednesday.

“In a landmark development, Pakistan and the United States finalised a trade agreement today aimed at boosting bilateral trade, expanding market access, attracting investment, and fostering cooperation in areas of mutual interest,” the Pakistani embassy in the US posted on X on Thursday morning.

Trump announced the deal on his platform Truth Social early Thursday morning.

“We have just concluded a deal with the country of Pakistan, whereby Pakistan and the United States will work together on developing their massive oil reserves,” Trump wrote.

“We are in the process of choosing the oil company that will lead this partnership. Who knows, maybe they’ll be selling oil to India some day!”

There was no formal announcement from either side on what tariff rate was agreed upon, but the Pakistani embassy said the agreement “will result in reduction of reciprocal tariff especially on Pakistani exports to the United States.”

“This deal marks the beginning of a new era of economic collaboration especially in energy, mines and mineral, IT, cryptocurrency and other sectors,” the embassy said.

“The deal complements Pakistan’s existing efforts of broadening the scope of Pak-US economic ties and to include partnerships at the US states level. The agreement enhances Pakistan’s access to the US market and vice versa.”

The deal was reached during a meeting of Aurangzeb, US Secretary of Commerce Howard Lutnick, and US Trade Representative Ambassador Jamieson Greer. Commerce Secretary Jawad Paul and Pakistan’s Ambassador to the US Rizwan Saeed Sheikh were also present during the meeting.

The Pakistan embassy said the deal is expected to spur increased US investment in Pakistan’s infrastructure and development projects.

“This trade agreement underscores the commitment of both nations to deepen their bilateral relationship and explore all avenues for strengthening trade and investment ties.”

Prime Minister Shehbaz Sharif thanked Trump for his leadership role in finalising the “historic US-Pakistan trade agreement”, saying in a post on X that “this landmark deal will enhance our growing cooperation so as to expand the frontiers of our enduring partnership in days to come.”

Early this morning, Foreign Minister Ishaq Dar also confirmed the trade deal but provided no details.

Aurangzeb called the deal a “win-win” for both countries.

“Today marks the culmination of the journey we started a few months back,” he said in a video message released by the Ministry of Finance on Thursday.

Aurangzeb reflected on the progress made since the talks related to the tariffs began, highlighting efforts to address non-tariff barriers, correct the trade imbalance, and review tariff lines on both sides.

“We had a very constructive final round of discussion which then lead to finalising the trade deal, which was later on announced by President Trump.

“From our perspective, it was always going beyond the immediate trade imperative. The whole point of this is that trade and investment have to go hand in hand,” the finance minister said.

He expressed his gratitude to several people and entities for their involvement in the process.

“The role of the private sector is prominent, because when we were trying to figure out how to reduce or end the trade imbalance, the private sector was the first constituent who came up and said they will help,” Aurangzeb said.

He thanked the commerce secretary and Ambassador Sheikh, and their respective teams, saying, “Where we stand today is because of our teamwork.”

While reiterating Trump’s message in his post, Aurangzeb called it a “real win-win situation for Pakistan and the United States”

“We are in a good place today in Pakistan in terms of where we have arrived before August 1, and for that, I congratulate everyone.

“I think we have come a long way from where we were to where we are today in terms of our overall strategic partnership between Pakistan and the US. It will, God willing, go from strength to strength as we go forward.”

Pakistan, which Washington has designated a “major non-NATO ally” in its effort to counter China’s influence in the region, faced a potential tariff of 29 per cent declared in April that was later suspended for 90 days to allow trade talks.

Last week, Dar said both nations were “very close” to a trade deal that could come within days, after he met US Secretary of State Marco Rubio on Friday.

They discussed expanding trade and ties in critical minerals and mining, the two sides said afterwards. Other Pakistani officials have also visited for talks in recent weeks.

Under Trump, Washington has sought to renegotiate trade deals with many countries, which he threatened with tariffs for trade relations he calls unfair, a characterisation many economists dispute.

US total goods trade with Pakistan was an estimated $7.3 billion in 2024, the office of the US trade representative says on its website, up from about $6.9bn in 2023.

In 2024, its goods trade deficit with Pakistan was $3bn, up 5.2pc from 2023.

Rabbani demands govt take Parliament into confidence

Meanwhile, former Senate chairman Mian Raza Rabbani criticised the development, saying that it was “a sad day for transparency and good governance, when the people of Pakistan come to know through a tweet of the US President that an oil exploration deal has been finalised.”

He said the government must realise that such deals and projects were governed under Article 172 of the Constitution and the provinces had 50 per cent ownership of all lands, minerals and other things of value.

“The federal government should immediately take Parliament into confidence on the new Western-oriented initiatives.

“It should call a meeting of the Council of Common Interests and take provinces into confidence on such and other projects,” he said in a statement.

Additional reporting by Nadir Guramani.