The Global Trade Research Initiative (GTRI) believes that third-country trade networks bring over USD 10 billion worth of indian commodities to Pakistan. GTRI stated in a statement that some companies are sending indian goods to pakistan through ports like dubai, Singapore, and Colombo, allowing indian products to reach pakistan despite trade restrictions that were put in place after the horrific april 22 terror events in Pahalgam.
"GTRI estimates India's Goods worth over USD 10 billion reach pakistan via this route, annually," stated the note. According to the GTRI, which described the innovative strategies used by the exporters, indian companies ship their goods to these ports, where an independent company offloads them and stores them in bonded warehouses at the port locations where they may be kept duty-free while in transit.
"In the bonded warehouse, the labels and documents are modified to show a different country of origin. For example, Indian-made goods may be relabelled as "Made in UAE". After this change, they are shipped to countries like pakistan, where direct trade with india is not allowed," the note added.
Because the trade seems to be coming from other countries, this strategy allows businesses sell at higher prices utilizing the third-country channel and get over trade barriers between india and Pakistan.
For instance, a company exports $100,000 worth of car parts to dubai from India. They are shipped to pakistan for USD 130,000 after being rebranded as uae goods. This increased cost includes access to a closed market, storage, and documentation.
"This transshipment model is in the gray area, even though it isn't always against the law. It demonstrates how companies come up with innovative strategies to maintain commerce, frequently more quickly than governments can respond," the note continued.
The indian government has announced several diplomatic measures in response to the 26-person terror attack in Pahalgam. These include closing the Integrated Check Post (ICP) at Attari, suspending the SAARC Visa Exemption Scheme (SVES) for Pakistani nationals, giving them 40 hours to return to their country, and lowering the number of officers in the High Commissions on both sides.
Trade activities are probably going to be negatively impacted for a long time by the animosity between the two nations.
Following the pahalgam attack, india also terminated the 1960 Indus Waters Treaty.
"GTRI estimates India's Goods worth over USD 10 billion reach pakistan via this route, annually," stated the note. According to the GTRI, which described the innovative strategies used by the exporters, indian companies ship their goods to these ports, where an independent company offloads them and stores them in bonded warehouses at the port locations where they may be kept duty-free while in transit.
"In the bonded warehouse, the labels and documents are modified to show a different country of origin. For example, Indian-made goods may be relabelled as "Made in UAE". After this change, they are shipped to countries like pakistan, where direct trade with india is not allowed," the note added.
Because the trade seems to be coming from other countries, this strategy allows businesses sell at higher prices utilizing the third-country channel and get over trade barriers between india and Pakistan.
For instance, a company exports $100,000 worth of car parts to dubai from India. They are shipped to pakistan for USD 130,000 after being rebranded as uae goods. This increased cost includes access to a closed market, storage, and documentation.
"This transshipment model is in the gray area, even though it isn't always against the law. It demonstrates how companies come up with innovative strategies to maintain commerce, frequently more quickly than governments can respond," the note continued.
The indian government has announced several diplomatic measures in response to the 26-person terror attack in Pahalgam. These include closing the Integrated Check Post (ICP) at Attari, suspending the SAARC Visa Exemption Scheme (SVES) for Pakistani nationals, giving them 40 hours to return to their country, and lowering the number of officers in the High Commissions on both sides.
Trade activities are probably going to be negatively impacted for a long time by the animosity between the two nations.
Following the pahalgam attack, india also terminated the 1960 Indus Waters Treaty.
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