Indian tea exports to Pakistan plunged 50% since clashes in February: report

Indian tea exports to Pakistan have plunged 50 per cent since the two countries clashed in February, according to a report published by Indian business news website Business Standard. 

Amid growing tensions over the illegal annexation of Indian-occupied Kashmir by Indian Prime Minister Narendra Modi, the tea trade between Pakistan and India is likely to take a further hit. 

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In August, Pakistan suspended trade ties with India over the human rights abuses being carried out by New Delhi in occupied Kashmir. However, bilateral trade between the two had been affected since February.

Back in February, Indian fighter planes had attacked Pakistan, violating Pakistani airspace with the intent to harm. However, Pakistan Air Force responded by downing an Indian plane and capturing the pilot. 

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India downgraded trade ties after Indian pilot Abhinandan was captured in February, and shown in a video praising the quality of tea in Pakistan during interrogation by the Pakistan Army. 

According to Business Standard, India increased the duty on imports from Pakistan nearly 200 per cent following the humiliation. However, Pakistan responded responsibly and maintained restraint. 

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After the illegal annexation of Kashmir, however, Pakistan had no option but to downgrade ties. As a result, the export of tea from India to Pakistan declined further, leading to the 50 per cent decline overall. 

Pakistan is the world’s biggest tea importer after Russia in value terms. According to estimates, the country imports about $560 million worth of tea every year, compared with $490 million worth of tea imports by Russia.

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Exporters told the Indian publication that the main reason for declining tea exports was that nobody wanted to stick their neck out and be seen as exporting to Pakistan. 

“Pakistani buyers usually don’t falter on payments. Our trade relations with them were good until recently,” said a tea exporter, lamenting over the loss of trade.