The ongoing trade war between India and Pakistan will hit Islamabad hard as it is dependent on India as far as bilateral trade is concerned

On August 9, Pakistan formally suspended trade relations with India in response to the revocation of the special status of Jammu & Kashmir. In 2018, according to data collated by United Nations Conference on Trade and Development, bilateral trade between India and Pakistan was worth $2.8 billion, of which $2.3 billion was India’s exports to and $500 million its imports from Pakistan.

1. Pakistan Is More Dependent On India For Its Exports

Pakistan’s dependence on India is slightly higher than India’s on its neighbour. India’s exports to Pakistan are 0.73% of its total exports while India accounts for 1.62% of Pakistan’s exports.

2. Pakistan’s Imports From India Are Five Times India’s Imports From Pakistan

When it comes to imports, India is even less dependent on Pakistan. In 2018, Pakistan accounted for 0.09% of India’s total imports. India constitutes 3.9% of Pakistan’s total imports.

3. India, The Largest Importer Of Pakistani Cement 

Cement is the only good with a significant chunk coming from Pakistan. No other commodity imported from Pakistan is more than 10% of India’s total imports.

4. Pakistan Is Hugely Reliant On India For 40 Commodities

For 40 commodities, Pakistan’s imports from India constitute more than 10% of its total imports. For 17 of these goods, more than one-fourth of Pakistan’s imports come from India. These commodities are likely to become costlier in Pakistan.

5. Trade Ban Could Hit Exporters In Both India And Pakistan

While an import ban will push up domestic prices, an export ban can hurt domestic producers, who may struggle to find new markets. Pakistan is a big market for India’s animal oils and cotton.

6. For 26 Goods, More Than 10% Of Pak’s Exports Go To India

There are 13 commodities for which more than one-fourth of Pakistan’s total exports go to India and the ban will badly impact its domestic producers.

Pakistan’s Actions Have Backfired Before

After the Pulwama terror attack in February and the Balakot strike, Pakistan closed its airspace to Indian flights in retaliation. Though the closure was meant to stifle flights to and from India, it ended up hurting Pakistan considerably.

While airlines lost time and money on rerouting flights, Pakistan lost millions in overflight fees earned when planes pass through foreign airspace. About 400 flights a day avoided Pakistani airspace, resulting in losses of $100 million since the closure, which was lifted on July 12

What Is Air Toll?

Airlines pay civil aviation administration of the country they are flying over a certain fee based on the type of aircraft, the distance covered while overflying a country and the weight of an aircraft before it takes off. For a Boeing 737, Pakistan charges $580. The amount will rise in case of larger aircraft like the Airbus 380 or Boeing 747. The rates differ from one country to another.