India-Pakistan trade

Weakening trade ties

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

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.