Indo-Pak trade row escalates after India bans imports from Pakistan. Tensions between the two nations have reached a new high following a deadly attack in Indian Illegally Occupied Jammu and Kashmir (IIOJK). The Indian government announced an immediate halt to all goods originating from or transiting through Pakistan.

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The Directorate General of Foreign Trade declared the ban “in the interest of national security and public policy.” The announcement did not mention any exemptions or time limits.

Indo-Pak trade row:Attack Triggers Drastic Moves

The trade row intensified after the April 22 attack in Pahalgam, IIOJK. At least 26 tourists lost their lives. India claimed that Pakistani-backed militants were behind the attack. Pakistan, however, denied any involvement and demanded an impartial international probe.

In response to India’s allegations, Pakistan accused New Delhi of preparing military retaliation. Pakistan countered by closing border trade, restricting Indian flights, and expelling Indian diplomats.

Both nations have taken aggressive steps. India’s decision to halt trade and Pakistan’s response have further strained relations.

Political and Economic Fallout

The Indo-Pak trade row now includes diplomatic and financial consequences. India asked the International Monetary Fund (IMF) to review Pakistan’s financial aid program. Islamabad dismissed this request, calling it a political tactic.

Pakistan’s finance ministry stated the $7 billion IMF bailout remains secure. Adviser Khurram Schehzad confirmed that Pakistan’s economy is stabilizing and gaining investor trust.

He also mentioned an extra $1.3 billion secured for climate resilience. This funding arrived in March 2025, further boosting confidence.

India’s efforts to isolate Pakistan have included suspending the Indus Waters Treaty and closing its airspace to Pakistani carriers. Pakistan sees these moves as escalatory and has warned of strong reactions.

Transitioning from economic measures to diplomatic moves, both countries have expelled diplomats. They have suspended treaties, adding fuel to an already volatile situation.

Broader Implications of the Trade Row

The trade row may cause long-term instability in South Asia. Frequent disruptions can hurt regional trade and economic cooperation. Peace talks are off the table, and mutual distrust grows deeper.

Without open communication and verified facts, false narratives and misunderstandings will only worsen the conflict. Both sides should step back and consider peaceful alternatives.

In conclusion, the Indo-Pak trade row underscores the fragile nature of regional peace. Immediate steps toward de-escalation and dialogue are essential for restoring balance.

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