India’s trade war with Pakistan may cost it $1.8b

Photo: AFP

Pakistan is considering multiple options to curtail bilateral trade with India. 

A Ministry of Commerce source said that Pakistan may even consider a complete ban on imports from India or an increase in tax and duty rates. A complete ban on Indian movies and television dramas is also another option, the source added.

The volume of trade between India and Pakistan is approximately $2.15 billion. Indian exports to Pakistan are worth $1.8 billion, while Pakistan’s exports to India are worth $350 million.

More than 40 Indian soldiers were killed in Pulwama district of Indian-Administered Kashmir over a week ago. New Delhi accused Jaish-e-Mohammad. Pakistan has asked India to provide any evidence to prove the claim.

In reaction to the attack, India revoked Pakistan’s Most-Favoured Nation status, which affects trade. New Delhi also raised duties on major Pakistani products as a protest against the Pulwama attack.

Related: India launches trade war on Pakistan over Pulwama attack

Around 300 trucks carrying cement, one of Pakistan’s major exports to India, were stuck a day earlier at the Wagah border after duties were suddenly increased 200%. This made importing them very expensive or nearly impossible. Shipments of 170 containers by sea also came to a grinding halt.

The Indian market accounts for a quarter of Pakistan’s total cement exports. In the last financial year, Pakistan sold India $23 million worth of cement. Fruit and vegetable exporters will also bear the brunt of the reaction since they exported $41 million in production.

“We are not dependent on India as far as trade is concerned because there are no normal trade ties between the two counties,” economist Dr Ashfaq Hassan Khan told our correspondent. Khan said trade between the two countries is based on quick imports from India to bridge a gap in case there is any shortage of products like tomatoes, onions or sugar.

Related: Pakistani prisoner murdered inside Indian jail

“Extremist elements in the Indian government are fueling anti-Pakistan sentiments in an effort to win the upcoming elections while the other reason behind this conspiracy seems to be the hearing of the case against India’s Kulbhushan Jadhav in the International Court of Justice,” he said.

Pakistan imports cotton yarn, textile, sugar, machinery and chemicals, among other items from India while India mainly imports cement, textile, leather products, vegetables and fruits from Pakistan.

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