India has imposed an immediate ban on all direct and indirect imports from Pakistan, citing national security and public policy concerns following the April 22 Pahalgam terror attack that killed 26 tourists.

The Directorate General of Foreign Trade (DGFT) amended the Foreign Trade Policy (FTP) 2023 on May 2, prohibiting “direct or indirect import or transit of all goods originating in or exported from Pakistan” until further orders, with exceptions requiring government approval.

The decision, halting all inbound shipments, follows India’s closure of the Attari-Wagah border, suspension of the Indus Waters Treaty, and expulsion of Pakistani military attaches.

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India’s exports to Pakistan from April-January 2024-25 were $447.65 million, primarily organic chemicals ($129.55 million) and pharmaceuticals ($110.06 million), while imports were minimal at $0.42 million, including fruits, nuts, and medicinal plants.

Pakistan retaliated by suspending all trade with India, including third-country transactions, further straining ties already weakened since the 2019 Pulwama attack, when India imposed a 200% import duty and withdrew Pakistan’s Most Favoured Nation status. Bilateral trade has since dwindled, with 2023-24 recording $1.18 billion in exports and $2.88 million in imports.

The ban, invoked under WTO security exceptions, reflects India’s zero-tolerance stance on cross-border terrorism, exacerbated by Pakistan’s alleged links to the Pahalgam attack.

Pakistan’s economy, already fragile with a projected 2.7% growth rate, faces further strain, particularly in cement and textile exports. As tensions persist, both nations brace for prolonged economic and diplomatic fallout.

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