Strong shipments to southern, eastern, and northern Europe offset slight decline in UK exports.
Pakistan’s exports to European countries grew by 4.5% year-on-year in the first half of fiscal year 2025-26, driven primarily by higher shipments to southern, eastern, and northern European states.
However, concerns are rising that recent agreements between India and the European Union (EU) could challenge Pakistan’s market share, particularly in the European textile sector, where India remains a key competitor.
According to the State Bank of Pakistan, export earnings from the EU increased to $4.638 billion during July-December 2025, up from $4.438 billion in the same period last year.
Western Europe, including Germany, the Netherlands, France, Italy, and Belgium, accounted for the largest share of exports, which saw a slight increase of 0.23%, rising to $2.195 billion from $2.190 billion.
Exports to southern Europe showed a notable increase of 9.16%, reaching $1.667 billion in the first half of FY26, up from $1.527 billion. Shipments to Spain rose by 11.35% to $807.45 million, and exports to Italy increased by 7.51% to $612.88 million. In contrast, exports to Greece declined by 9.03% to $64.45 million.
Exports to northern Europe rose 4.82% to $373.006 million, while shipments to eastern Europe increased by 10.51% to $403.576 million.
Despite the overall growth in exports to the EU, shipments to the UK, once Pakistan’s largest export destination before Brexit, slightly decreased by 0.27%, dropping to $1.096 billion in FY26, down from $1.099 billion in the previous year.
On Monday, Foreign Minister Ishaq Dar chaired an inter-ministerial meeting to review measures aimed at strengthening trade and economic relations with the EU. He emphasised the importance of expanding cooperation under the GSP+ framework, noting that Pakistan has successfully completed four biennial GSP+ reviews, reaffirming its commitment to meeting all obligations under the scheme.
