New Delhi: India has snapped all kinds of trade ties, be it direct or "indirect" imports, following the terror attack in Jammu and Kashmir's Pahalgam in which 26 people lost their lives. The recent announcement also explicitly banned indirect trade through intermediary nations, along with postal services and parcel deliveries from the neighbouring country.
"Direct or indirect import or transit of all goods originating in or exported from Pakistan, whether or not freely importable or otherwise permitted, shall be prohibited with immediate effect, until further orders," the notification said.
However, despite the trade ban, some portion of the Pakistani goods may still be flowing into India via third countries. According to a national daily, goods such as dry fruits and chemicals worth $500 million are reportedly entering India through intermediary countries.
A significant portion of these exports, which were earlier sent directly from Pakistan, are now being rerouted via alternative nations, an official told TOI.
Pakistan has been using alternative routes via third countries in the past as well, when India imposed a 200% import duty in 2019 after the Pulwama terror attack. This trend has since intensified, particularly via the UAE and Sri Lanka, potentially exploiting regional trade agreements.
Pakistani products such as fruits, dry dates, leather, and textiles are reportedly repackaged in the UAE. Meanwhile, chemicals and speciality goods are routed through Singapore, and items like cement, soda ash, and textile raw materials are moving through Indonesia. Sri Lanka is also being used to process and route dry fruits, salt, and leather products, leveraging benefits under the South Asian Free Trade Area (SAFTA) framework.
Given that a significant portion of the $500 million in Pakistani exports may now be entering India through alternative routes, a government official has stressed the urgent need for a comprehensive ban covering both direct and indirect imports. There is also a pressing need to closely monitor misrepresentation of country-of-origin in incoming goods.
"This comprehensive ban imposed by India, including a ban on indirect exports, would enable the customs authorities to prevent Pakistan exports from entering India through circumvention," the official said.
Tensions have escalated between India and Pakistan after the Pahalgam terror attack, in which terrorists opened fire at a popular tourist site - Baisaran meadow - killing 26 civilians. The NIA, in its preliminary investigation, has uncovered strong evidence pointing towards the involvement of Pakistan-based terror outfit Lashkar-e-Taiba, the Inter-Services Intelligence (ISI), and elements of the Pakistan Army in the planning and execution of the Pahalgam terror attack.