EU in Pakistan

EU-Pakistan Political Relations

The partnership between the European Union and Pakistan has progressed since 1962 in tandem with the European integration process. In order to further strengthen EU-Pakistan relations the two sides in 2012 adopted a 5-Year Engagement Plan with the common goal of building a strategic partnership for peace and development rooted in shared values, principles and commitments. The Engagement Plan aims at facilitating cooperation on a wide range of issues, including democracy, human rights, rule of law, socio-economic cooperation, energy, counter terrorism and migration. In order to implement the plan a wide range of political dialogues are carried out at all levels from ad-hoc summits between the heads of state and government to sectoral dialogues at technical level between experts in different fields.

Today, the EU and Pakistan are not only partners in trade GSP+ but also important political and development partners. The EU is a strong supporter of Pakistan’s democratic development, illustrated by successive election observation missions and technical assistance provided to Pakistan’s parliament and to the Election Commission of Pakistan to advance electoral reforms. The EU is also committed to cooperate with Pakistan in its fight against the shared burden of terrorism and extremism. At the same time the EU supports Pakistan’s efforts to improve its human rights record, in particular in areas such as access to justice, freedom of religion or belief and the rights of women and girls, and provides education and economic opportunities for all Pakistanis.

Migration is another area of cooperation, where the two sides have concluded a readmission agreement, ensuring the return of irregular migrants lured by smugglers. The EU also fully recognises Pakistan’s vital role in promoting peace and stability in the South Asian region and beyond, and supports the Government’s declared goals of improving relations with its neighbours. The EU-Pakistan 5-year Engagement Plan will come to an end in 2017 and the two sides have initiated discussions about a new framework for cooperation that can guide relations for the future aiming at further strengthening the strong ties between the peoples of the EU and of Pakistan.

EU-Pakistan Trade and Investment

The EU is Pakistan’s largest export market and one of its largest trading partners. Overall EU-Pakistan trade reached EUR 10.5 billion in 2015, with Pakistan enjoying a trade surplus of EUR 1.6 billion. Pakistan’s exports are dominated by textiles and clothing, followed by leather and vegetable products. Main imports from the EU are mechanical and electrical machinery followed by chemicals.

From January 1, 2014 Pakistan has enjoyed  unprecedented duty/quota free market access to the EU under the GSP+ scheme in exchange for a commitment to implement 27 international conventions on human rights, labour rights, good governance and the environment. In the first year alone, this led to an increase in Pakistani exports to the EU of more than 20%. Many opportunities under GSP+ remain untapped and Pakistan and the EU are exploring ways to diversify exports to the European market.

Besides, the EU continues to play an important role by investing in Pakistan both through Foreign Direct Investment (FDI) and portfolio investments. In the Fiscal Year 2014/15, the EU share of foreign private investments in Pakistan was almost 25%. Investments range from energy exploration to food, textiles and other manufacturing sectors. In addition, the EU has been supporting Pakistan through a trade-related technical assistance programme and an EU-Pakistan trade dialogue that is carried out under the auspices of the yearly EU-Pakistan Joint Commission.

Pakistan’s largest provider of development assistance

The European Union (EU is the world’s largest provider of development assistance. EU assistance to Pakistan is growing and, together with Member States, the EU disbursements for development and humanitarian assistance in Pakistan is now about EUR 700 million per year (appr. 77 billion Rs).

The EU is supporting Pakistan in its efforts to achieve the Millennium Development Goals, namely to tackle poverty, increase literacy, reduce malnutrition and child mortality, improve maternal health, combat major diseases, ensure environmental sustainability and promote an inclusive and gender balanced development process.

The assistance provided through the EU Delegation is principally focused on providing long-term support for Rural Development, Education & Technical and Vocational Training, as well as Governance, Human Rights and Rule of Law.

The bulk of the cooperation provided through the EU Delegation to Pakistan is implemented through three main categories of implementing partners:

  • The federal and provincial governments,
  • The Rural Support Programmes, and
  • EU Member States agencies.

Geographically, half of the EU’s on-going commitments target KP and Sindh, whereas a quarter is allocated to nation-wide projects or multi-provincial projects.

EU Humanitarian Aid and Civil Protection Department (ECHO)

In 2016, ECHO plans to provide EUR 21.5 million (PKR 2.6 billion) worth of emergency and humanitarian assistance as well as for Education in Emergency. This will bring ECHO’s total humanitarian assistance to a total EUR 537.5 million  (PKR 64 billion) since 2007, in addition to the support provided by EU member states.