Issue Brief on “Prospects and Challenges of Pakistan-India Trade “

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Introduction

The heavy burden of history and persistently strained relations between Pakistan and India have been a significant source of wedge in their economic ties as well. Often, trade is seen to become a first victim of souring relations. Although significant potential for trade between the two states exists, bilateral tensions have impeded its optimal actualization. This illustrates an adverse relationship between tensions and trade between the two countries.

With the rise in geopolitical tensions across the globe, trade relations are witnessed to be caught in the crossfire. Such cases have been observed worldwide. The U.S.-China trade relations are being impacted due to their geopolitical tensions in the shape of ‘trade and tech wars’ and a similar case is discernible between India and China’s trade ties, which are increasingly marred by their border issues and growing geopolitical rivalry. While trade between neighbours undeniably rests on a convincing argument, an analysis of Pakistan-India relations reveals that trade amid tensions is less likely to sustain a persistent momentum.

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