Bilateral Trade: Germany and Pakistan Forge Stronger Economic Links

As of October 2023, economic cooperation between Germany and Pakistan has shown a positive trajectory, characterised by increasing bilateral trade, investment, and development collaboration. This relationship has been strengthened by Germany’s commitment to supporting Pakistan in various developmental areas.

Bilateral trade has been on the rise, with Germany emerging as one of Pakistan’s most significant trading partners within the European Union. In 2024, bilateral trade amounted to nearly 4 billion euros. Pakistan primarily exports textiles, leather goods, sports equipment, footwear, and medical instruments to Germany, while Germany’s main exports to Pakistan include machinery, chemicals, electrical goods, motor vehicles, and iron products. Efforts to diversify trade relations are actively ongoing.

German investments in Pakistan have predominantly been directed towards sectors such as renewable energy, infrastructure, and manufacturing. Both the German government and private companies are keen on investing in sustainable development projects that align with Pakistan’s economic growth strategies. Given Pakistan’s energy challenges, Germany has engaged in various renewable energy initiatives, especially in solar and wind energy. This collaboration leverages Germany’s expertise in clean technologies to enhance Pakistan’s energy security and sustainability.

In terms of technical cooperation and development aid, Germany has been providing support to Pakistan through organizations like GIZ (Deutsche Gesellschaft für Internationale Zusammenarbeit). This assistance includes efforts in education, vocational training, healthcare, and sustainable development initiatives. Additionally, there is a focus on enhancing collaboration in science and technology between German and Pakistani institutions, fostering advancements in sectors such as agriculture, water management, and environmental conservation.

The established academic and scientific exchange plays a significant role in cultural relations between Germany and Pakistan. The Goethe-Institut in Karachi, along with its affiliated partner and accredited Goethe-Zentrum in Lahore (the Annemarie-Schimmel-Haus), serves as a major player in cultural relations by offering programs and language courses. Germany has become a popular destination for young Pakistani researchers seeking to pursue PhD studies, alongside the United States, the United Kingdom, and Australia. Currently, more thousands of young Pakistanis are studying in Germany.

Additionally, organizations such as the Friedrich-Ebert-Stiftung, the Friedrich Naumann Foundation for Freedom, and the Hanns Seidel Foundation are active in Pakistan, supporting initiatives aimed at strengthening democratic institutions, promoting human rights, empowering women, tackling climate change, facilitating de-radicalization, fostering regional cooperation, and advancing media work.