Economy and Trade

Economic relations between Pakistan and Denmark have been steadily improving in recent years. At the first and second rounds of Pakistan-Denmark Bilateral Political Consultations held on 2 March 2018 and 25 November 2020 respectively, it was agreed to make economic relations a priority area for cooperation between the two countries.

Pakistan’s exports to Denmark have registered a positive trajectory for many years. Imports from Denmark have on the other hand declined. Pakistan is a beneficiary of the GSP Plus status of the European Union that allows for tariff free imports into the EU from Pakistan, which makes Pakistani products highly competitive in Denmark. Trade statistics for the past three years are shown in the table below:

Pakistan Denmark Trade
(Thousand US Dollar)
FY18FY19FY20 (P)
Imports from Denmark213.211 80.428 80.890 
Exports from Pakistan178.225187.291196.492
Total Trade391.436267.719277.382

Source: State Bank of Pakistan, Statistics and Data Warehouse Department

The main products exported by Pakistan to Denmark include clothing and apparels, home textiles, sports balls, surgical equipment, leather gloves and basmati rice. Pakistani made apparels and home textiles can be found in all major Danish retail outlets including JYSK, Ikea, Netto, Bilka, Fotex, Jack and Jones, Vero Moda etc. Pakistan manufactures world class soccer and other sports balls and is the main supplier for brands such as Select, Derbystar and Adidas.

The major imports from Denmark include machinery, parts, medical and pharmaceutical products, vegetable fats, chemicals, and metals, medical and surgical instruments etc. The Danish company FL Smidth is a major supplier of technology and machinery for cement plants in Pakistan.

There are around 52 Danish companies with business interests in Pakistan. They include major companies like A.P. Møller/Maersk, F.L. Smidth, Beirholm, Eldan Recycling, Haldor Topsoe, Sanovo Technology, Borch Textile group, Wernerfelt Textile Company, Select A/S and KMC).

Danish investment in Pakistan was US$300,000 in 2016, US$500,000/- in 2017 and in 2018 US$100,000. The Danish Investment Fund for Developing Countries (IFU) has provided financing for 15 private sector projects in Pakistan, 13 of which are complete and 2 are ongoing. The Danish Government through IFU and the DANIDA Sustainable Infrastructure Finance is assisting Pakistan in the construction of two Wastewater Treatment Plants one for the city of Faisalabad and the other for the city of Lahore

An Agribusiness delegation focusing on food, agriculture and sustainability visited Pakistan (Lahore and Karachi) on 13-16 January 2019. It comprised of companies like AAK, DS Triple, Foss, Jeros and Jimco. They held separate meetings with the representatives of Fauji Foods, BigBird, Mondelez, Dairyland besides undertaking visits to Venus Pakistan and Bunny’s Ltd.

A four-member Danish trade delegation participated in EXPO Pakistan held in Karachi from 9th – 12th November 2017. The delegation also held B-2-B meetings with their counterparts on the margin of Exhibition. 

A Seminar titled “Doing Business in Pakistan: A Fresh View” was organized by Asia House to explore business prospects in Pakistan in December 2017. The participants included some of Denmark’s best-known enterprises. 

Bilateral Agreements:

  1. Convention on Social Security (1982),
  2. Agreement on Promotion and Protection of Investment (1996)
  3. Agreement on Avoidance of Double Taxation (2002)