Under government orders, India has imported all goods directly or indirectly from Pakistan, effective immediately, due to the interests of national security and public policy, after the Pahargam terrorist attack last month killed 26 tourists.
The decision will completely stop all cargo transport from Pakistan to India. India's exports to Pakistan from April 25 to January 25, 2024 was US$447.65 million, while imports were US$420,000.
This provision has been added to the Foreign Trade Policy (FTP) of 2023 to prohibit the direct or indirect import or transit of all goods exported directly or from Pakistan until further orders”.
It added that such restrictions were imposed for the benefit of national security and public policy. The order says any exception to the ban will require approval from the Indian government.
It inserts the provision under the title “Prohibited Import from Pakistan” in the FTP, which says: “The direct or indirect import or transit of all goods originating from Pakistan or exported from Pakistan, whether freely import or otherwise permitted, shall be immediately prohibited with direct effect until further order.”
2024 – From April to 25, 2025, major imports from neighboring countries include fruits and nuts ($0.08 million), certain oilseeds and medicinal plants ($2.26 million), and organic chemicals.
The decision comes after a terrorist attack in Pahalgam on April 22, in which 26 people were killed. After the terrorist attacks, India has taken a series of measures, including the immediate closure of the Attari Land-Transit outpost for transporting certain goods. In addition, India announced the expulsion of Pakistan's military annex and suspended the 1960 Indus Water Treaty.
Therefore, trade between India and Pakistan has completely stopped. There is little two-way trade between the two countries after the 2019 Pulvama terrorist attack.
In retaliation, Pakistan also announced a suspension of all trade with India, including any third country in Pakistan. Exports and imports in 2023-24 were US$1.18 billion and US$2.88 million, respectively.
In 2022-23 and 2021-22, India exported $627.1 million and $513.82 million worth of goods, with imports of $20.11 million and $2.54 million respectively.
From January to 25, 2024-25, exports of organic chemicals and pharmaceutical products accounted for 60% of the total freight shipments in the country to Pakistan. $129.55 million and $110.6 million, respectively.
Other items include sugar and sugar candy ($85.16 million), certain vegetables ($3.77 million), coffee, tea and spices ($1.66 million), cereals ($139,000), petroleum products ($1.63 million), oil ($6 million), $6 million ($6 million), Polastics (UBBERICS (UBBER), IBBER (USD) and $116 million ($160 million), 1888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888888
India-Pakistan trade relations have turned sour after the Pulwama terrorist attack. India then raised its import tax to 200% of all commodities imported from neighboring countries, including fresh fruit, cement, petroleum products and mineral ore.
In 2017-18, Pakistan exported USD 488.5 million. India also withdrew its position as MFN (the most popular country) and arrived in Pakistan.
At that time, the two main projects imported from Pakistan were fruit and cement. The 200% import tax effective means imports are almost prohibited. The country cited a security exception clause from the World Trade Organization (WTO) to withdraw its MFN status. Both countries are members of the organization.
India granted Pakistan an MFN status as early as 1996, but neighboring countries did not pay back. Under the MFN PACT, WTO member states are obliged to treat another trading country in a non-discriminatory manner, especially in terms of customs obligations and other taxes.
In 2012, Pakistan worked to grant MFN status to India, but withdrew it due to domestic opposition. Pakistan said it is not an MFN, but is committed to granting India a non-discriminatory market access (NDMA) status, but it has not announced it either.
Pakistan also suspended its trade relations with New Delhi in August 2019 because of India's heavy responsibility for Pakistan's imports. The relationship between the two countries has a long history, mainly due to the Kashmir issue and the cross-border terrorism sent by Pakistan.
India-Pakistan's total trade was US$2.41 billion in 2017, compared with US$2.27 billion in 2016-17. India imported $488.5 million in 2017-18 and exported $1.92 billion.
