Pakistan’s formal negotations with the United States on recirpocal tariffs started on Friday with a phone call between Finance Minister Muhammad Aurangzeb and US Trade Representative Jamieson Greer, a press release from the finance ministry said.

The increase in trade tariffs on Pakistani products announced by US President Donald Trump, which were paused, could have a devastating impact on Pakistan’s important exports and served as a wake-up call for diversification, according to a state-owned think tank.

The Pakistan Institute of Development Economics warned that these tariffs would have a “devastating impact” on the country’s export sector, translating into an annual loss of $1.1-1.4 billion.

According to the finance ministry, Aurangzeb and Greer “exchanged their view point through a constructive engagement, with the understanding that technical level detailed discussions would follow in the coming few weeks”.

“Both sides expressed confidence in advancing these negotiations for successful conclusion at the earliest,” the ministry added.

Trump’s tariffs, implemented on April 2, introduced a 10 per cent baseline tariff for every country the US trades with, and additional reciprocal tariffs on rivals and allies alike.

The steep hike targeting Chinese goods raised Washington’s additional rate on many products to 145 per cent, the White House confirmed. The two nations have engaged in talks, which the US treasury secretary says have “stalled”.