Pakistan should diversify its exports from heavy dependence on textiles and undertake structural reforms to boost productivity, said World Trade Organisation (WTO). The WTO noted in a trade policy review that textiles and clothing accounted for two thirds of exports, but the sector was facing stronger competition in major markets.

A report by Pakistan to the WTO further said it would continue to pursue trade liberalization so that it could benefit from any deal in the Doha round. Pakistan hopes to benefit from a cut in rich-country agriculture subsidies, which would makes exports such as sugar, ethanol and cotton more competitive.

It also believes cuts in rich-country tariffs would make textiles and other exports more competitive. US WTO Ambassador Peter Allgeier said Pakistan could increase foreign investment but needed to improve investor protection. Further trade and investment liberalization, including resisting protectionist pressures, along with other structural reforms, should help productivity.