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Pakistan Pushes for Economic Reset with US, Urges ‘Year of Action’ in 2026

Pakistan Pushes for Economic Reset with US, Urges ‘Year of Action’ in 2026

 

By The South Asia Times

WASHINGTON - Pakistan has called for the early launch of a high-level economic dialogue with the United States, urging both countries to recalibrate their relationship from a security-centric framework to one anchored in trade, investment, and technology cooperation.

 

The proposal was made during a series of meetings in Washington between Pakistan’s Ambassador to the United States, Rizwan Saeed Sheikh, and senior members of Congress, including House Foreign Affairs Committee Chairman Brian Mast and House Armed Services Committee Chairman Mike Rogers, according to daily Dawn.

 

According to official briefings issued after the meetings, Ambassador Sheikh stressed that 2026 should be treated as a “year of action”, aimed at converting political goodwill into tangible economic outcomes. He underscored the need for institutionalised engagement in priority sectors such as energy, defence, critical minerals, information technology, and artificial intelligence.

 

“Our focus is shifting from geopolitics to geoeconomics,” the ambassador said, outlining Pakistan’s desire for a partnership driven by long-term economic integration rather than episodic political cooperation.

 

Highlighting Pakistan’s manufacturing potential, Sheikh said the country’s low-cost, high-quality industrial base could help meet rising US market demand. He pointed to surgical instruments, textiles, and sports goods as sectors with strong export prospects, noting that footballs produced in Sialkot have been used in five consecutive FIFA World Cups.

 

The push for deeper economic ties comes amid renewed interest in Washington to expand engagement with Islamabad. US Secretary of State Marco Rubio recently described Pakistan as a partner with “significant untapped potential,” praising decades of cooperation, particularly in counterterrorism. At the same time, Rubio sought to reassure regional partners, saying closer ties with Pakistan would not undermine America’s longstanding relationship with India.

 

“I don’t think anything we’re doing with Pakistan comes at the expense of our relationship or friendship with India,” Rubio said in October 2025, describing US policy in South Asia as pragmatic and interest-based.

 

President Donald Trump, however, has publicly acknowledged frictions in Washington’s relationship with New Delhi, particularly over trade. Speaking this week, Trump said that while he maintained good personal ties with Indian Prime Minister Narendra Modi, tensions had emerged over tariffs and energy-related disputes.

 

During his meetings on Capitol Hill, Ambassador Sheikh also praised President Trump’s political engagement in helping defuse tensions following the military escalation between Pakistan and India in May 2025, which had raised international alarm over regional stability.

 

Security concerns featured prominently in the discussions. Sheikh warned that terrorism originating from Afghanistan continued to pose serious risks to Pakistan and the broader region. He told US lawmakers that terrorist incidents inside Pakistan rose by 40 per cent in 2024 and by a further 25 per cent in 2025, attributing the surge to militant networks operating from Afghan territory. He also expressed concern over the continued circulation of advanced weapons left behind after the US withdrawal from Afghanistan.

Addressing South Asian dynamics, the ambassador said India’s actions during the May 2025 crisis had lowered the threshold for escalation between two nuclear-armed neighbours. He cautioned that future confrontations were increasingly shaped by advanced technologies and dual-capable weapons, warning that miscalculations in a region home to 1.7 billion people could have catastrophic consequences.

 

Sheikh reiterated that lasting peace in South Asia remains unattainable without addressing the Kashmir dispute and the right of self-determination of its people.

 

Both sides agreed on the importance of establishing structured, regular dialogue mechanisms on economic cooperation, security, and regional stability. The ambassador also invited congressional leaders to visit Pakistan to deepen parliamentary engagement and people-to-people ties.

 

In a post on X following his meeting with Chairman Rogers, Ambassador Sheikh said the talks focused on the “ascendantly evolving Pak-US partnership,” as well as regional security challenges and the growing threat of militancy emanating from Afghanistan.

 

“Had a productive meeting with Chairman @RepMikeRogersAL, Chairman Armed Services Committee to discuss the ascendantly evolving Pak-US partnership,” he wrote. “Focused on regional security challenges, the escalating and sponsored terrorism from Afghanistan, and the subsequently urgent need to address the leftover military equipment. Emphasized that a stable, standalone Pak-US relationship remained vital to regional as well as global peace, security and stability.”

 

Commenting separately on his meeting with Chairman Mast, the envoy said the two exchanged views on regional and global developments, explored avenues for enhanced counterterrorism cooperation, and reaffirmed that 2026 must mark a transition from intent to implementation in bilateral relations.

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