Pakistan’s textile industry has begun discussions with the European Union over the renewal of the Generalised Scheme of Preferences Plus trade facility, with the bloc stressing that progress on human rights, labor standards and environmental reforms will be important for any extension beyond 2027.
EU Ambassador Raimundas Karoblis, accompanied by First Secretary Kert Ajamaa, Development Cooperation Manager Theis Munksgaard Hansen and Senior Economist and Trade Advisor Husnain A. Iftakhar, met senior representatives of the All Pakistan Textile Mills Association at APTMA House on Friday.
Karoblis said Pakistan would need to demonstrate concrete progress in implementing and legislating international conventions linked to GSP+ eligibility. He urged businesses, particularly exporters, to work with the government to address concerns raised by the European Commission regarding human and labor rights, governance and environmental standards.
The ambassador also acknowledged efforts by Pakistan’s textile industry to improve sustainability, saying such initiatives would be an important consideration in the EU’s assessment of an application to renew the facility.
APTMA Chairman Kamran Arshad said the EU was Pakistan’s largest trading partner and that GSP+ had allowed 78 percent of Pakistan’s goods exports to enter the European market without duties. He said the facility had supported employment, investment and technological upgrades while contributing to Pakistan’s target of achieving net zero carbon emissions by 2050.
Arshad warned that losing GSP+ could have a major impact on Pakistan’s exports, potentially costing the country more than Rs. 1 trillion annually and putting textile mills and jobs at risk. He said the fallout could also reach the banking, real estate and transport sectors, noting that textile companies accounted for more than 40 percent of outstanding bank loans.
He added that any disruption to the facility could also affect progress on labor rights, anti-corruption measures and narcotics control initiatives. APTMA Chairman North Asad Shafi said textile companies had invested billions of dollars in European machinery as part of their expansion plans.
Shafi urged the EU ambassador to support efforts to accelerate negotiations for a Pakistan-EU free trade agreement, similar to the India-EU FTA, which he described as a potential safeguard against any interruption in GSP+ access. He also outlined APTMA’s compliance efforts, including its support for a proposed National Compliance Entity, and reaffirmed the industry’s commitment to addressing compliance gaps before Pakistan reapplies for the facility.
The discussions come shortly after Pakistan completed its fifth EU GSP+ review. The country is now preparing for a formal reapplication under the EU’s revised GSP framework, with the deadline set for December 31, 2028, while existing beneficiaries continue to receive GSP+ preferences during the two-year transition period.
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