Pakistan – Trade Performance under the GSP+ Kishwar Khan November 2017 Since 1 January 2014, Pakistan is a beneficiary to the European Union’s Generalised Scheme of Preferences Plus(GSP+), which is approaching to its mid-term of ten years in 2018. In this perspective, this work aims to gain an understanding of Pakistan’s trade performance under the GSP+. It explores as to how macro-economic variables as well as internal and external factors affect the environment within which the trade takes place. Where does Pakistan stand vs. other Asian countries? What are the challenges facing the textiles industry that is the largest contributor to the exports? What are the implications of the limited diversity in prod­ucts and concentration in fewer markets? Does low profit margin reflect inefficiency or if there are certain other factors behind this; what is the space available to the industry to reduce cost? The analysis provides answers to these questions, and chalks out recommendations for the industry players. Using secondary data and a sample survey, this research helps diagnose specific areas requir­ing attention to effectively utilising the GSP+. Improving competitiveness is the key challenge. The government needs to ensure uninterrupted supply of energy, and improve law and order. The discussion identifies reforms in the most crucial policies, i.e. textiles, trade, fiscal, mone­tary, investment and agriculture The GSP+ award is concomitant with effective implementation of international conventions on human and labour rights, governance and environment protection ratified by Pakistan. Linkage of trade incentives with the conventions is aimed to promote sustainable develop­ment and good governance by utilizing enhanced export opportunities. The increased exports and profits of the industry players substantiate that the GSP+ offers an opportunity to utilize the linkages of the export-oriented industry for inclusive development. Hence, greater trans­parency and a shared vision for sustainable production is emphasized.