Pakistan’s recent move to suspend trade and close its airspace to India is expected to cause significant disruption for the Indian economy and its aviation sector.
During the last brief closure of Pakistani airspace, Indian airlines incurred losses of $80 million. With renewed restrictions, airlines are raising concerns about flight delays, increased operational costs, and rising ticket prices. Indian passengers will now face longer travel times and higher fares, with many likely to opt for alternative international airlines offering cheaper routes.
On the trade front, India’s exports to Pakistan, which had reached $1.21 billion, will be severely affected. Key export items like cotton, organic chemicals, food products, edible vegetables, plastics, man-made filament, tea, spices, dyes, oil seeds, dairy items, and pharmaceuticals will no longer reach Pakistani markets. This poses a direct blow to Indian exporters, particularly impacting merchandise sectors and the middle class.
Also read: Pakistan suspends trade, ties and flights off-limits in response to India’s actions
India now faces both economic losses and logistical challenges as a result of Pakistan’s retaliatory measures.
Key Losses to India:
- Aviation Sector Losses:
- The previous airspace closure caused Indian airlines to lose approximately $80 million in just a few days.
- Renewed closure will increase fuel costs, flight durations, and ticket prices.
- Passenger inconvenience due to rerouting and delays.
- Shift of Indian travellers to international carriers offering cheaper alternatives.
- Trade Losses:
- Annual exports worth $1.21 billion to Pakistan have been halted.
- Major impacted goods include:
- Cotton
- Organic chemicals
- Prepared animal fodder
- Edible vegetables
- Plastics and man-made filament
- Coffee, tea, and spices
- Dyes and oil seeds
- Dairy products and pharmaceuticals
- Impact on Indian Middle Class & Exporters:
- Small and medium businesses dealing in affected sectors will face significant revenue hits.
- Middle-class producers and traders are especially vulnerable due to halted market access.
India now faces a compounded burden of economic strain and logistical disruption as diplomatic tensions with Pakistan continue to escalate.
