Pakistan Imports From India Up 69% Despite Trade Ban: Why?

New Delhi: Pakistan’s recorded imports from India rose 69 per cent in the first quarter of the 2026-27 fiscal year to about ₹5,876 crore ($61.74 million), even though both countries have restricted trade since the 2025 Pahalgam attack. Pakistan, meanwhile, recorded no exports to India at all.

What the figures say

The data come from the State Bank of Pakistan for July to September 2026. Imports from India rose 68.9 per cent to $61.74 million, and no Pakistani exports to India were recorded. The rupee figure is a conversion of the dollar number at current rates. India has no recorded imports from Pakistan in the period. Pakistan’s trade deficit with its nine neighbours rose 26.6 per cent to $4.97 billion, as imports from those countries grew faster than exports.

The ban, on both sides

Pakistan suspended formal trade with India in August 2019, allowing a few humanitarian exceptions, mainly pharmaceutical raw materials. After the April 22, 2025 Pahalgam attack, which killed 26 people, India banned all direct and indirect imports from Pakistan. Pakistan responded by banning Indian-origin goods, including transit of such goods by third countries, and closed its ports to Indian-flagged ships. The Attari-Wagah crossing, the only land trade route, has also been shut.

How goods still reach Pakistan

Trade analysts say Indian goods get there through third-country hubs such as Dubai, Singapore and Sri Lanka. Indian exporters sell to a buyer in the hub, the paperwork is changed so the goods appear to come from that country, and they are then shipped on to Pakistan. For the Indian company, a sale to a third-country buyer is technically a legal export. Pakistani buyers typically pay more, with one trade researcher in Islamabad estimating a 15 to 25 per cent premium. Pakistan’s foreign minister acknowledged in 2024 that goods keep coming through indirect routes at higher cost.

The goods in demand include pharmaceuticals and their active ingredients, chemicals, plastics, sugar, cotton and yarn, tea, dyes, vegetables, iron and steel, and auto parts.

How big is the hidden trade?

The think tank GTRI estimates that about $10 billion of Indian goods reach Pakistan each year through re-exports, mainly via the UAE and Singapore. That figure is an estimate, not an official count. For comparison, India’s recorded exports to Pakistan in April to January 2024-25 were about $448 million.

A caution on the “mystery”

The $61.74 million figure shouldn’t be read as the size of the relabelled trade. The same data series a year earlier, which showed about $36.6 million, was described by analysts as largely pharmaceutical raw materials that Pakistan permits on humanitarian grounds. Goods relabelled in Dubai or Singapore would normally be recorded under those countries, not India. So the official jump probably reflects permitted direct imports, such as medicine inputs, and says little about the larger indirect flow. The spike also doesn’t mean the bans are collapsing, since the amount is small.

What to watch

Key questions are whether India tightens scrutiny of exports routed through hubs, whether Pakistan widens exemptions for medicines and industrial inputs, and whether any official figures emerge for the indirect trade.