There has been a structural shift of trading partners in Pakistan — from traditional western countries to those geographically closer and culturally similar.
Over the past decade the combined share of the United States and the United Kingdom of trade into Pakistan has declined by 15 percentage points to 26%. The Middle East also has a sweet slice of the pie from oil imports, while Pakistan is receiving dollars in the form of remittances sent by its millions of overseas citizens working there.
While the potential for trade with India is high, it accounts for just 5% of total volume due to longstanding military tension between the wary neighbours, while Pakistan’s exports to Afghanistan are on the rise.
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