How India's Shipping Ban on Pakistani Goods is Impacting Trade Costs

Impact of India's Ban on Pakistani Imports

Islamabad: A recent report indicates that India's prohibition on ships transporting Pakistani goods from docking at its ports has led to increased freight costs and extended transit durations.

In response to the Pahalgam terror incident, India enacted a sweeping ban on May 2, 2025, halting both direct and indirect imports or transits of goods from Pakistan.

Pakistani importers have expressed concerns that this ban has resulted in delays of 30 to 50 days for their shipments, as noted by the Dawn newspaper.

Javed Bilwani, President of the Karachi Chamber of Commerce and Industry, stated, “Mother vessels are not arriving in Pakistan due to this Indian action, which is causing significant delays in our imports.”

Importers are now dependent on feeder vessels, which further escalates their expenses.

Exporters have also reported an increase in shipping and insurance costs due to the Indian ban, although they claim the overall effect on exports has been minimal.

Aamir Aziz, a textile exporter, mentioned, “There is no major impact on exports, aside from a rise in insurance costs. Shipping fees had already increased prior to this escalation.”

Pakistan's exports heavily depend on imported materials for value addition. With the government enforcing strict controls on imports to preserve foreign currency, any disruptions in supply chains could have wider economic consequences.

Trade relations between India and Pakistan deteriorated following the Pulwama terror attack, which prompted India to raise import duties on all goods from Pakistan to 200%.

Since 2019, formal trade relations have been stagnant, with bilateral trade plummeting from USD 2.41 billion in 2018 to USD 1.2 billion in 2024. Exports from Pakistan to India fell from USD 547.5 million in 2019 to a mere USD 480,000 in 2024.