CAIT's Pakistan Business Ban: What Does It Mean For Both Countries
New Delhi: Formal trade between India and Pakistan is at a standstill, which was significantly worsened by the 2019 Pulwama terrorist attack. However, informal trade through third countries continued to flourish without disruption, despite being hit by evolving political developments and a halt in bilateral engagement.
On Sunday, April 27, the Confederation of All India Traders (CAIT) reached a unanimous agreement to completely cease trade with Pakistan, following the recent terror attack in Pahalgam, as per reports by several news agencies.
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The leading trade organization which represents the interests of over 9 crore traders and small businesses across the country, the decision was made during their two-day national governing council meeting held in Bhubaneswar. Over 200 influential trade leaders from 26 states across India participated in the event.
A statement issued by CAIT noted that the resolution condemned the terrorist act in Pahalgam and advocated for an all-out boycott of trade with Pakistan. The decision would follow the immediate halt of all imports and exports to neighboring countries.
“Traders have shown their complete support for the decisive actions taken by Prime Minister Narendra Modi against terrorism, calling for the harshest penalties for those responsible and their accomplices,” the statement noted.
How CAIT’s Decision Impacts Trade Between India And Pakistan?
According to CAIT, trade volume between India and Pakistan was nearly USD 3 billion in 2018. Following the 2019 Pulwama terrorist attack, the number steeply fell to around USD 1.2 billion by 2024. India has been exporting considerably more than it imports from the neighboring countries. Between April 2024 and January 2025,
It reported that the trade volume, which reached nearly USD 3 billion in 2018, fell to around USD 1.2 billion by 2024,
Between April 2024 and January 2025, India exported goods valued at approximately USD 500 million to Pakistan. The exports mainly consisted of pharmaceuticals, chemicals, sugar, and auto parts. Notably, the imports from Pakistan to India amounted to only USD 0.42 million.
With CAIT’s decision to completely halt trade with the neighboring country following the latest hostile escalation, this trade would be completely terminated.
The trade body, while making the decision, pointed out that maintaining trade with a country perceived as hostile is entirely unacceptable.
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According to Praveen Khandelwal, the CAIT Secretary General and BJP MP representing Chandni Chowk constituency, the business community throughout the nation stands united, ready to take any necessary measures under the leadership of Prime Minister Shri Narendra Modi in the present situation. The businessman-turned-politician further added that the measures were to safeguard the sovereignty and commercial independence of India.
Notably, following the measures by India, Pakistani health authorities have initiated “emergency preparedness” measures to secure pharmaceutical supplies. After India suspended the Indus Water Treaty, Islamabad on Thursday suspended all trade with New Delhi, while taking “urgent measures to secure” pharmaceutical needs in Pakistan.
Drug Regulatory Authority of Pakistan (DRAP) officials said that they are actively looking at alternative avenues to meet their pharmaceutical needs. It is reported that DRAP is seeking alternative sources from China, Russia, and several European countries.
Currently, Pakistan relies on India for 30% to 40% of its pharmaceutical raw materials, including Active Pharmaceutical Ingredients (API) and various advanced therapeutic products.
