Modi govt’s ban on both direct and indirect trade to hit Pakistan hard, exports to India worth half a Billion Dollars now halted
On 3rd May, Government of India imposed a blanket ban on all imports from Pakistan. The decision has been taken following the deadly Pahalgam Terrorist Attack that claimed lives of 26 innocent tourists, as Hindus were targeted. Pakistan-sponsored terrorist outfit Lashkar-e-Taiba’s offshoot, The Resistance Force, claimed responsibility for the attack, before taking a U-turn. India has taken several steps against Pakistan since then including revoking visas issued to Pakistani nationals including medical visas, suspending Indus Water Treaty, banning social media accounts of Pakistan celebrities, shutting down port for Pakistani ships and more.
The recent decision to ban imports will intensify the economic retaliation against the hostile neighbouring country. The decisive move covers both direct shipments and goods routed through third countries. With this decision, India has signalled a complete breakdown in trade ties with Pakistan. Notably, while direct imports from Pakistan are minimal, the indirect imports from Pakistan tune to around $500 million via countries like Sri Lanka, UAE, Indonesia and others.
What did India import from Pakistan?
Several products from Pakistan are popular in Indian markets. Top most products from Pakistan include Sendha Namak or Himalayan Rock Salt. It is mined from the Khewra salt range in Pakistan and is commonly used during fasts and in Ayurvedic practices. Despite the religious and health-linked relevance in India, the pink salt originating from Pakistan will not be allowed to enter India.
Similarly, Peshawari chappals and Lahori Kurtas, along with salwar suits and other garments will soon not be available in Indian markets. These products are often marketed by Indian boutiques as exclusive fashion imports.
The hidden trade between India and Pakistan
According to media reports, around $500 million worth of Pakistani goods enter India via intermediary countries like Sri Lanka and the UAE. These products used to come directly via Pakistan; however, the hostile relations between the two countries have resulted in them being channeled through alternate countries. The UAE often repackages and relabels Pakistani dry dates, leather, fruits and textiles before sending them to India. Chemicals from Pakistan come to India via Singapore.
Furthermore, Pakistani cement, soda ash, and raw materials for the textile industry also come from Pakistan via Indonesia. Sri Lanka serves as an alternative country for products like dried fruits, salt, and leather goods.
An estimated $500 million worth of exports reach India through these routes. As India has put a blanket ban on products originating from Pakistan and coming to India via direct and indirect routes, monitoring and identifying these products has become a necessity for the officials. Speaking to PTI, an unnamed official said, “This comprehensive ban imposed by India, including a ban on indirect exports, would enable the customs authorities to prevent Pakistani exports from entering India through circumvention.”
Direct imports from Pakistan are around $0.5 million per year, which is now expected to drop to zero. Notably, the only product that may attract the attention of consumers in India is Himalayan Pink Salt, also known as Sendha Namak, as the majority of it is produced in Pakistan. However, there are other sources from which India can obtain it.
Not to forget, India had imposed a 200% tariff on Pakistani goods in 2019 following the Pulwama attack. Direct trade between India and Pakistan between April 2024 and January 2025 was merely $0.42 million, which mostly included figs, basil, rosemary, and Sendha Namak.
As trade has stopped between India and Pakistan, products that were exported to Pakistan are also halted. These include cotton, organic chemicals, food products, animal fodder, edible vegetables, plastic articles, man-made filament, coffee, tea, spices, dyes, oil seeds, dairy products, and pharmaceutical items, which will create a void in the Pakistani consumer market.
Dry fruits and industrial goods also hit
Dry fruits coming from Balochistan and Peshawar such as almonds, walnuts, figs and raisins were in demand during winters and festival season in India. These too will go off shelves. Furthermore, cotton, confectionery items, optical goods, chemicals, steel and cement were part of the broader trade list between the two countries.
Impact and the road ahead
Pakistan’s economy is struggling and import ban will further push the country to bankruptcy. Domestically Indian markets may experience a temporary disruption in supply of some specialty products such as pink salt or sendha namak, however, alternates for the products are always available in the market. Government of India is likely to push for domestic production of certain products that were imported from Pakistan.
India has sent a strong signal that trade and talks cannot happen if Pakistan continues to sponsor terrorism in India. Cross-border terrorism will be met with unflinching economic consequences for the neighbouring country.
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