Weakening trade ties

Escalating tensions between India and Pakistan will worsen the already-strained trade ties between the two neighbours.

Published : Mar 13, 2019 12:12 IST

Trade between India and Pakistan, which was already under strain over the past four years, is set to weaken further in the backdrop of ceasefire violations and cross-border conflicts since the last week of February.

According to data from the Department of Commerce under the Ministry of Commerce and Industry, India’s exports to Pakistan recorded a 11.3 per cent decline in the five years between 2012-13 and 2016-17, while imports decreased by 15.8 per cent in the same period.

Imports from Pakistan declined substantially in 2013-14, but jumped in 2014-15 by 16.5 per cent before declining again in 2015-16 by 11.3 per cent. They showed a marginal rise of 3.5 per cent in 2016-17.

Overall, the total trade between the two countries fell from $2.6 billion to $2.3 billion in the five years.

With Pakistan, India has consistently enjoyed a favourable balance of trade, despite the fact that Pakistan maintains a negative list of 1,209 products that cannot be imported from India and also restricts imports through the crucial Attari-Wagah land border trading post to 137 items.

Pakistan’s exports to all destinations in 2017 totalled $21,877 million while its imports totalled $57,440 million, leading to a negative trade balance of -35,562 million, according to World Bank data.

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