Economic impact arising from such tensions “extremely marginal”, says FM Jaitley

Surgical strike; Causes and effects

On the night preceding 29th September, last week it was reported that the Indian army received specific, credible information regarding various terror activities being plotted against India. This information was regarding terrorist teams, who had positioned themselves at launchpads in Pakistan along the Line of Control, to carry out certain infiltration and terrorist strikes in the Jammu and Kashmir area and various other metros in India.

Therefore, in order to ensure that these terrorists do not succeed in their design of infiltration and attempts to carry out destructions and thus endanger the lives of the Indians, special security forces from India carried this strike in the Pakistan-occupied Kashmir during the wee hours of Sept 29th.

Indo-Pak Trade relations

A report by news agency NDTV says that the official trade between India and Pakistan was a modest $2.6 billion in 2014. So, are these business relations affected post the attacks?

• Following Uri attacks

Cross LoC trade continued at Uri post the attacks. Few hours later, reportedly, 26 trucks from India crossed over, while 10 from Pakistan-occupied Kashmir came in. But the relations between these rival countries; India and Pakistan seem to be worsened post the Uri Attacks held this September. Following it, India, along with leaders of Bangladesh, Afghanistan and Bhutan, withdrew itself from the SAARC Summit that was to be held this November in Islamabad. Moreover, India has also begun contemplating changes in water treaties with Pakistan. At the same time, the Indian government has been examining other diplomatic means of isolating Pakistan in recent days.

India barred participation in the ATPF CEO meet

As per reports, trade relations could not remain untouched as Pakistan scuttled India’s participation in the Asian Trade Promotion Forum (ATPF) CEO’s meet by withholding the travel permission of an Indian High Commission official to Lahore. This 29th ATPF CEO meet was held in Lahore from 24 to 26 September last month and the trade counselor of the Indian mission was about to attend the event. But he was denied the permission to travel. The ATPF comprises of 24 member countries including Australia, Japan and China. This forum aims to improve trade in the region through information exchange, implementation of cooperative projects, and thus strengthen networks among members.

• Post ‘surgical strikes’

In response to the recent “surgical strikes carried out by India, Finance Minister Arun Jaitley has expressed confidence that any economic impact arising from recent tensions with Pakistan and incidents like the surgical strikes undertaken by Indian Special Forces will be “extremely marginal”.

Currency and Stock Markets

Apparently,it was reported that The Pakistan Stock Exchange’s KSE 100 Index slipped 59.50 points, or 0.2 per cent, to 40,295.52.

On the other side, Indian Rupee lost 39 paise — its biggest single-day fall in three months— against the U.S. dollar that was to close at 66.85. Sensex closed with a loss of 465.28 points at 27,827.53 points. At the same time, Sensex crashed 555 points and Nifty fell about 170 points in noon trade after reports of surgical strikes against Pakistan.

Addressing a gathering at the University of Toronto’s Rotman School of Management, Indian FM Jaitley said that any impact that had been felt on the markets and the rupee had been “temporary”, and that foreign direct investment into India “continues to increase”.

Cyber attacks: Also after the surgical strikes, it was reported that Pakistan was creating propaganda that this attack by India was fake. Various news reports claim that they were circulating videos to prove the same. Likewise, experts say that thousands of Indian websites were hacked by techies from Pakistan. To counter the offensive, Indian hackers locked Pakistan government computers.  One of the hackers was reported saying that over 100 computers from Pak are now under his control; which belong to the education department, government tender website, among others.

Reportedly, the hacker says that he had received around 120 bitcoins to release the Pak computers. “The money is being distributed among the trusts involved in education of poor kids,” he said.”To unlock their data, techies from Pakistan also paid in Bitcoins but ‘patriotic’ Indians refused to give away the decrypt key to unlock the data. However, Pakistani officials have been asked to pay the amount again to unlock,” a black hat hacker told news agency, Mail Today.

Cinema: Following the strikes, major cinema houses in Pakistan stopped screening Indian films to express solidarity with armed forces in the wake of heightened tensions between the two rival countries; India & Pakistan. They also called their government to ensure the sale of DVDs of all Indian films was stopped. Reportedly, Nueplex and Atrium cinemas in Karachi stopped the screening of Amitabh Bachchan -starrer Pink during the course of time.

Subsequently, Pakistan’s film industry was seen fearing a 70 per cent business loss if Indo-Pak ties continued to worsen as that could eventually result in calls to ban Bollywood films permanently in their country.

In response, The Indian Motion Picture Producers Association, at a meeting in Mumbai, passed a resolution to ban Pakistani actors from the industry in the wake of the Uri terror attack. However, the resolution finally came after Indian Army announced the ‘surgical strike.’

In unison, Raj Thackeray-led Maharashtra Navavirman Sena issued an ultimatum to Pakistani artistes and actors including actor Fawad Khan, who is part of one of the productions under Salman’s banner, and Ali Zafar, to leave India by September 25 or else they would be “pushed out.” Also, recent concerts of Pakistani singers Shafqat Amanat Ali and Atif Aslam to be held in Bengaluru and Gurgaon respectively were also cancelled.

So, what are your views regarding India-Pakistan relations in the future?  Please share your thoughts and opinions in the comments section below:

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