Landmark US-Pakistan Trade Deal Sealed, Focus on Oil Reserves; India Faces Steep Tariffs

Breaking News: US-Pakistan Seal Landmark Trade Deal, India Faces Steep Tariffs

Islamabad, Pakistan – July 31, 2025 – In a swift and decisive move that reshapes regional trade, the United States and Pakistan have announced the finalization of a comprehensive trade deal. The agreement, confirmed by US President Donald Trump on his social media platform “Truth Social” and by officials from both nations, notably includes joint efforts to develop Pakistan’s “massive” oil reserves. This landmark development comes just hours after President Trump levied a significant 25% tariff on all imports from India, coupled with unspecified “penalty” measures over New Delhi’s continued purchases of Russian weaponry and energy.

President Trump stated in his post, “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.” He further hinted at the potential future: “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!”

The Pakistani Ministry of Finance, along with Finance Minister Muhammad Aurangzeb and Secretary Commerce Jawad Paul, confirmed the agreement, highlighting that it will lead to a reduction in reciprocal tariffs, particularly benefiting Pakistani exports to the United States. The deal is expected to foster broader economic cooperation in critical sectors including energy, mines and minerals, IT, and even cryptocurrency. This strategic alliance aligns with Washington’s broader efforts to strengthen ties in Asia.

The new trade landscape stands in stark contrast to the challenges now faced by India. President Trump, reiterating his “America First” trade agenda, imposed a 25% tariff on Indian imports, criticizing India’s “among the highest in the World” tariffs and “the most strenuous and obnoxious non-monetary Trade Barriers of any Country.” Furthermore, the “penalty” for India’s continued defense and energy dealings with Russia underscores the geopolitical dimensions of Trump’s trade policies.

The August 1 deadline for new trade deals, which President Trump had imposed on dozens of nations, “stands strong, and will not be extended,” he affirmed. This deadline has driven a flurry of last-minute negotiations, with the US having sealed trade frameworks with several countries in recent weeks.

While Indian officials are currently “studying the implications” of the new tariffs, industry experts anticipate a significant impact on India’s export-oriented sectors. Despite previous engagements and discussions between the two nations aimed at a bilateral trade agreement, the reluctance to fully open key sectors appears to have contributed to the current impasse.

This bold move by the Trump administration signals a clear recalibration of its trade strategy in South Asia, elevating Pakistan’s economic partnership while applying significant pressure on India to realign its trade and foreign policy.