India-Pakistan Trade Takes a Hit: Attari Border Closure Impacts Punjab
Attari Border Closure Deals a Blow to India-Pakistan Trade
India’s decision to close the Attari-Wagah Integrated Check Post (ICP) following the recent terror attack in Pahalgam has put a halt to roughly Rs 3.88 billion worth of cross-border trade between India and Pakistan. This closure comes after bilateral trade had already been declining since India imposed a hefty 200% duty on Pakistani goods in 2019, in response to the Pulwama terrorist attack.
Trade at Attari: A History of Ups and Downs
The Attari border has been a vital trade route, allowing India to export goods like soya bean, poultry feed, and vegetables, while importing items like dry fruits, dates, and gypsum. Even though tensions between the two countries have been high, trade through Attari saw a rebound in 2023, reaching its highest point in five years. However, the overall volume of cargo movement has significantly decreased since 2018.
Punjab Feels the Impact Most
Punjab, particularly the Amritsar and Attari regions, has heavily relied on this trade. Thousands of people, from transporters to shopkeepers and factory workers, have benefited from the economic ecosystem created by the Attari border. Political parties in Punjab have long advocated for keeping the trade route open.
Economic Challenges for Pakistan
Pakistan’s own economy is facing significant challenges, with high inflation and social unrest. The International Monetary Fund (IMF) has downgraded Pakistan’s growth forecast, citing global trade tensions and US tariffs as contributing factors. The closure of the Attari border will worsen these economic woes, further impacting Pakistani traders.
A Delicate Balance
The Attari border closure highlights the complex relationship between India and Pakistan, where trade often becomes a casualty of political tensions. While the security concerns are understandable, the economic impact on both sides, particularly on the communities reliant on this trade, cannot be ignored.
