After Pahalgam terror attack, India shuts Attari border. How will it impact trade with Pakistan?

Pahalgam terror attack: India responded to the terror attack in Jammu and Kashmir's Pahalgam by announcing that it would shut the Integrated Check Post (ICP) at Attari in Amritsar along the India-Pakistan border in Punjab with immediate effect. 

India also decided to suspend the Indus water treaty until Pakistan credibly and irrevocably abjures its support for cross-border terrorism. At least 26 people, mostly tourists, were killed in a terror attack at the picturesque Baisaran meadow of Pahalgam in Anantnag district on April 22.

India's decision to downgrade diplomatic ties with Pakistan in view of cross-border links to the Pahalgam terror attack was taken in the Cabinet Committee on Security (CCS) meeting held at Prime Minister Narendra Modi's residence on April 23.

Where is Attari- Wagah Border?

Attari and Wagah refer to the same international border between India and Pakistan. Attari is the name of the Indian village on the border, while Wagah is the name of the Pakistani village on the border.

Located 28 kilometres from Amritsar, Attari is India’s first Land Port and the only permitted land route for trade with Pakistan. Spread across 120 acres and directly connected to National Highway-I, the check post has played a crucial role in cross-border trade, particularly in imports from Afghanistan.

The border checkpost is a popular site where troops from both countries exchange sweets during the Muslim holiday of Eid and the Hindu holiday of Diwali.

"Those who have crossed over with valid endorsements may return through that route before 1st May 2025," Foreign Secretary Vikram Misri said on April 23, clarifying that the route will remain open for returnees for a limited time.

How Significant is the Attari Border?

The check post at Attari has been a critical trade conduit between India and Pakistan, handling various goods. Exports to Pakistan, such as soybean, chicken feed, vegetables, red chillies, plastic dana, and plastic yarn, travel through this route.

Imports from Pakistan comprise dry fruits, dry dates, gypsum, cement, glass, rock salt, and various herbs. The corridor continued to facilitate the exchange of goods and people despite ongoing tensions and a decline in trade volume since 2019 when India imposed 200 per cent duty on Pakistani goods in 2019 post the Pulwama terror attack, according to the data from Lands Ports Authority of India quoted by the Indian Express.

How will it impact India-Pakistan trade?

The Attari-Wagah corridor has seen fluctuating trade and passenger movement figures in the last few years. In 2023-24, for example, the land port recorded trade worth ₹3,886.53 crore, 6,871 cargo movements, and 71,563 passenger crossings, according to the data. This was the highest trade between the two nations in the past five years.

From ₹ 4,370 crore in 2018-19, the trade through this route had reduced to ₹2,257 crore in 2022-23. In 2018-19, the cargo movements through Attari border between India and Pakistan were 49,102 consignments which fell down to 3,827 in 2022-23, according to the data. 

The closure of the Attari Land Port will have significant economic repercussions on the movement of goods and passengers. According to reports, small traders and manufacturers who rely on this cross-border exchange will be affected the most.

Afghan imports into India and vice versa, many of which pass through Pakistan via the Attari-Wagah route, may also face logistical challenges.

Pakistan Denies Involvement

The Pahalgam attack has worsened the already-strained India-Pakistan ties.

Pakistan has, however, denied any involvement in the Pahalgam terror attack. “Pakistan has nothing to do with it (Pagalgam terror attack)," Defence Minister Khawaja Asif told a local TV channel on April 23.

The Resistance Front (TRF), an offshoot of Pakistan-based Lashkar-e-Taiba, is believed to be behind Tuesday's attack, a claim that Mint has not been able to verify so far. Some reports even suggested that a top Lashkar-e-Taiba commander, Saifullah Kasuri, alias Khalid, is believed to be the ‘mastermind’ of the attack. There has not been any official word on these claims yet.

Tuesday's attack was carried out in the fabled Baisaran meadow of Pahalgam on a day when United States Vice President JD Vance was in India and Prime Minister Narendra Modi was on a state visit to Saudi Arabia. Modi cut short his visit and came back to New Delhi on Wednesday morning.