(MENAFN- KNN India)
New Delhi, Oct 28 (KNN) India's imports from Pakistan have dropped to zero in the first five months of the current financial year (2024-25), underscoring the deteriorating trade relations between the two neighbours.
However, India exported USD 235 million worth of goods to Pakistan during this period, primarily sugar and pharmaceuticals, according to government data released on Sunday. This shift highlights the widening trade imbalance and ongoing geopolitical tensions between the two countries.
Trade between India and Pakistan has been on a downward trajectory since 2018-19, when rising political tensions led to punitive economic measures.
The turning point came in February 2019 when India revoked Pakistan's Most Favoured Nation (MFN) status in response to Pakistan's alleged support for cross-border terrorism. The move introduced high tariffs on Pakistani imports, which severely impacted bilateral trade.
In the financial year 2018-19, India exported USD 2.07 billion worth of goods to Pakistan, while imports from Pakistan stood at USD 495 million.
However, this dynamic shifted drastically in the following year. In 2019-20, India's exports to Pakistan fell by 60.5 per cent to USD 817 million, and imports from Pakistan saw a dramatic decline of 97.2 per cent, plummeting to just USD 14 million.
Pakistan escalated the economic standoff by unilaterally suspending bilateral trade with India in August 2019, following India's decision to abrogate Article 370 and revoke Jammu and Kashmir's special status.
This move was part of a broader strategy by Islamabad to downgrade diplomatic relations.
However, by September 2019, Pakistan made a partial reversal, allowing imports of essential therapeutic products from India, reflecting the need to maintain access to critical healthcare supplies.
In the 2023-24 financial year, India's imports from Pakistan were limited to USD 3 million, mainly agricultural products. Now, with official imports reduced to zero, India continues to supply essential goods to Pakistan.
An Indian government official, speaking on condition of anonymity, emphasised that trade normalisation depends on Pakistan taking concrete actions to curb cross-border terrorism.
“Trade and terror do not go simultaneously. Pakistan must halt terror activities if it hopes to improve relations with India. India is regarded as a reliable trading partner by major global economies, but Pakistan's policies leave it isolated,” the official said.
As India strengthens its economic ties with other nations, Pakistan finds itself increasingly marginalised in regional trade. Without a shift in political and diplomatic strategies, meaningful economic cooperation between the two countries remains unlikely in the near future.
(KNN Bureau)
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