Latest Pakistan-India conflict cost both nations $1 billion an hour combined — economist

Security personnel stand guard near the Karachi Port in Karachi on May 9, 2025, amid the ongoing border tensions between India and Pakistan after the Kashmir tourist attack. (AFP)
Short Url
Updated 14 May 2025
Follow

Latest Pakistan-India conflict cost both nations $1 billion an hour combined — economist

  • Estimated daily losses amounted to around $20 billion per day, with Pakistan losing up to $4 billion and India as much as $16 billion a day
  • 30-day conflict would cost the countries around $500 billion combined, with over a $400 billion loss for Indian economy, economists estimate 

ISLAMABAD: A four-day military standoff between arch foes Pakistan and India last week cost both nations an estimated $1 billion an hour combined, a leading economist said this week, as a finance adviser to the government argued the conflict would have “minimal fiscal impact” for Islamabad.

Tensions between nuclear-armed neighbors India and Pakistan escalated after a deadly April 22 attack on tourists in Indian-administered Kashmir that India blamed on Pakistan, which denied involvement. On the night of May 6/7, India struck multiple sites in Pakistan that it said was “terrorist infrastructure” and Pakistan retaliated, downing five Indian fighter jets. 

Over the next four days, the two nuclear-armed rivals engaged in the worst fighting between them since 1999, pounding each other with fighter aircraft, missiles, drones and artillery fire, until a ceasefire was brokered by the US and other nations on Saturday. 

The military confrontation had in the meantime disrupted stock markets, led to airspace closures, escalated defense spending and caused economic losses amounting to billions of dollars.

Asked about the economic cost of the conflict, Farrukh Saleem, a prominent Pakistani political scientist and economist, said he estimated the 87-hour confrontation cost “about a billion dollars an hour for both countries put together,” breaking it down into estimated costs borne by either of the neighbors.

“India has a much larger army, much larger air force. Once it starts moving, once it starts mobilizing its troops, it costs about, let’s say, 12 to 20 times more for the Indian army to mobilize itself as compared to the Pakistani army,” Saleem said.

“So, when I say a billion dollars an hour, you’re probably looking at 20 percent of that being incurred by Pakistan and a good 80-85 percent by India.”




Farrukh Saleem, a Pakistani political scientist and economist, talks to Arab News in Islamabad, Pakistan, on May 13, 2025. (AN photo)

The investment in war was also different, Saleem said, comparing India’s French Rafale fighter jets to Pakistan’s Chinese J-17 Thunders and J-10cs. 

“You look at Rafale, for instance, which is the French aircraft, with its paraphernalia, it’s about $240 million apiece. India has a $16 billion investment into Rafales,” Saleem explained. 

“On the other hand, Pakistan Air Force has gone for cheaper platforms. They are either JF-17 Thunders or J-10Cs and they’re like $20-25 million.”

In terms of missiles, the Indian ballistic missile BrahMos is $3 million apiece. 

“If you’re firing, let’s say, 8 to 10 [missiles] a day, that’s 10 times $3 million, that’s $30 million in one day,” the economist said. 

Arab News reached out to the defense ministry and Pakistan’s military media wing for official estimates of the latest conflict’s cost but did not receive a response. 

But Khurram Schehzad, an adviser to the Pakistani finance minister, said the fiscal impact on Pakistan would not be large.

“The current standoff with India won’t have a large fiscal impact on Pakistan,” he told Arab News. “It can be managed within the current fiscal space, with no need for a new economic assessment.”

Schehzad said Pakistan’s economic resilience was evident from a new record at the Pakistan Stock Exchange, which on Monday posted the highest single-day gain in over 26 years, surging by 10,123 points or 9.45 percent, significantly surpassing the losses recorded last week following the Indian strikes.

“Pakistan’s measured and responsible response, in both its narrative and actions on the ground, has caught investors’ eye, alongside the potential positive spillover effect of a possible settlement in the US-China tariff issue,” he added.

But economists say the recent military standoff has already inflicted heavy financial losses on both countries.

Saleem said daily economic losses from the conflict, including stock market declines and other impacts, amounted to around $20 billion per day, with Pakistan losing up to $4 billion and India as much as $16 billion a day.

“I have tried to put things together. If this conflict had continued for 30 days, my estimate is that both countries would have lost a good $500 billion, with over a $400 billion loss for the Indian economy,” he said.

Dr. Ali Salman, Executive Director of the Policy Research Institute of Market Economy (PRIME), an Islamabad-based independent economic policy think tank, said the conflict had disrupted economic sentiment and affected investor confidence.

“Certainly, investors would not like to come into countries, whether India or Pakistan, if they are in a constant war-like situation,” he told Arab News.

He also warned that a prolonged conflict would push people in both countries deeper into poverty, noting that one in four poor people in the world lived in India or Pakistan.

“We have 27 percent of the world’s poor in just these two countries, and I believe that we need to come out of the military contest and go into an economic contest,” he added.

Another economist, Shakeel Ramay, said every war had an economic dimension and this conflict too had imposed a heavy financial burden on both economies.

“Pakistan’s military expenditure over the four-day conflict, including jets, artillery and missiles, amounted to around $1.5 billion from the national budget, by my estimate,” he said, a significant cost as the country walked a tricky path to economic recovery bolstered by an $7 billion IMF bailout.

“The good thing is our economic activities continued without interruption, retail markets operated smoothly with no shortages and trade routes remained open, all indicating that the direct economic cost was minimal,” Ramay added. 


High-level Saudi delegation in Pakistan to strengthen parliamentary ties

Updated 5 sec ago
Follow

High-level Saudi delegation in Pakistan to strengthen parliamentary ties

  • Pakistan and Saudi Arabia enjoy strong trade, defense and cultural relations
  • The Saudi delegation will meet top Pakistani parliamentarians during the visit

ISLAMABAD: A high-level parliamentary delegation of the Saudi Shoura Council arrived in Pakistan to strengthen parliamentary ties between the two countries, the National Assembly of Pakistan said on Sunday.
The delegation, led by the Head of the Saudi-Pak Parliamentary Friendship Committee Dr. Abdulrahman bin Sanhat bin Abdullah Al-Harbi, is visiting Pakistan on the invitation of Pakistan’s National Assembly Speaker Ayaz Sadiq.
It comprises members of the Saudi Shoura Council and the Saudi-Pak Parliamentary Friendship Committee, Dr. Iman bint Abdulaziz Al-Jabreen and Engineer Salem bin Ali Al-Shahrani.
The delegates held a meeting with NA Speaker Sadiq in Islamabad, during which both sides agreed to promote parliamentary exchanges, according to a statement on the National Assembly of Pakistan’s Facebook page.
“The Pak-Saudi Friendship Group established in the National Assembly is playing an important role in promoting harmony between the parliaments of the two countries,” NA Speaker Sadiq was quoted as saying.
“Exchanges of parliamentary delegations will give the parliamentarians of both countries an opportunity to benefit from each other’s experiences.”
Dr. Abdulrahman said Saudi Arabia attaches great importance to its relations with Pakistan, according to the Pakistani National Assembly statement.
“During the meeting, discussions were held on the unity of the Muslim world, and joint role for peace and development in the region,” it read.
Pakistan and Saudi Arabia enjoy strong trade, defense and brotherly relations. The Kingdom is home to over 2 million Pakistani expatriates, serving as the top destination for remittances for the cash-strapped South Asian country.
Saudi Arabia has also extended significant support to Pakistan during prolonged economic challenges faced by Islamabad in recent years, including external financing and assistance with International Monetary Fund (IMF) loan programs.


Pakistan’s new electric vehicle policy targets 30% green cars by 2030

Updated 22 June 2025
Follow

Pakistan’s new electric vehicle policy targets 30% green cars by 2030

  • The policy aims to cut Pakistan’s reliance on imported fuel, shielding the economy from global oil price fluctuations
  • Electric vehicles are also expected to offer long-term savings for consumers through reduced fuel and maintenance costs

ISLAMABAD: Pakistan has unveiled an ambitious New Electric Vehicle Policy (NEVP) 2025–2030 that targets 30% of all new vehicle sales to be electric by 2030, Pakistani state media reported on Sunday.

The policy, which covers cars, buses, motorcycles and rickshaws, aims to accelerate the country’s shift toward sustainable transport, reduce fossil fuel dependence, and curb climate-warming emissions, the state-run APP news agency reported.

Pakistan imports most of its energy needs and the country’s urban areas exhibit some of the world’s highest levels of air pollution, primarily due to sub-2.5 μm particulate emissions. This issue significantly impairs both the country’s economy and the quality of life of its residents.

“Transitioning to electric vehicles (EVs) is critical for a healthier, greener and economically stable future,” Muhammad Saleem Shaikh, a spokesperson for the Climate Change Ministry, told APP, contending that transport sector was a major contributor to air pollution and greenhouse gas emissions in Pakistan.

With the NEVP now in effect, Pakistan, which has seen erratic changes in its weather patterns which experts blame on climate change, joins a growing list of nations pushing for zero-emission mobility to combat climate change and urban pollution.

Mohammad Asif Sahibzada, director-general of the Climate Change Ministry, highlighted that EVs produce zero tailpipe emissions, which will significantly reduce urban smog and help Pakistan meet its international commitments.

“This shift will also lower respiratory and cardiovascular diseases, particularly benefiting children and the elderly,” he added.

The policy aims to cut Pakistan’s reliance on imported fossil fuels, shielding the economy from global oil price fluctuations. EVs are also expected to offer long-term savings for consumers through reduced fuel and maintenance costs.

The government plans to incentivize EV adoption through tax breaks, subsidies, and infrastructure development, including nationwide charging stations.

“Electric vehicles are not just about transport; they are central to Pakistan’s climate action strategy,” Muhammad Azeem Khoso, the ministry’s director for urban affairs, was quoted as saying by the APP.

“This policy marks a decisive step toward a cleaner, more resilient future.”


Pakistan, China and Russia to push for ceasefire as UN Security Council meets on Iran

Updated 22 June 2025
Follow

Pakistan, China and Russia to push for ceasefire as UN Security Council meets on Iran

  • The three countries have circulated a draft resolution text and asked UNSC members to share comments by Monday
  • A resolution needs at least nine votes in favor and no vetoes by the US, France, Britain, Russia or China for it to pass

ISLAMABAD: Pakistan, China and Russia will present a joint resolution calling for an immediate and unconditional ceasefire in the Middle East, the Pakistani mission to the United Nations (UN) said on Sunday, ahead of a UN Security Council meeting to discuss US airstrikes on Iranian nuclear sites.

It was not immediately clear when it could be put to a vote. The three countries circulated the draft text, and asked members to share their comments by Monday evening. A resolution needs at least nine votes in favor and no vetoes by the United States, France, Britain, Russia or China to pass.

The US is likely to oppose the draft resolution, which condemns the attacks against “peaceful nuclear sites and facilities under the IAEA (International Atomic Energy Agency) safeguards in the Islamic Republic of Iran” and says that such attacks represent a threat to international peace and security, and to the entire safeguards regime of the IAEA, according to a draft seen by Arab News.

It calls for an immediate and unconditional ceasefire and a diplomatic solution to the nuclear issue to reach an agreement acceptable to all parties that “guarantees the exclusively peaceful nature of the Islamic Republic of Iran’s nuclear program in exchange for complete lifting of all multilateral and unilateral sanctions.”

“Pakistan, China and Russia jointly have drafted a resolution and it is hoped that other countries like Algeria may also become its approvers,” Pakistan’s UN mission said.

“So far, it has been shared with the members countries for comments, which is a procedure before tabling it in the UNSC.”

The member countries will comment on the draft resolution and then a final draft will be tabled in the Security Council.

The world awaited Iran’s response on Sunday after President Donald Trump said the US had “obliterated” Tehran’s key nuclear sites, joining Israel in the biggest Western military action against the Islamic Republic since its 1979 revolution.

Iran requested the UN Security Council meeting, calling on the 15-member body “to address this blatant and unlawful act of aggression, to condemn it in the strongest possible terms.”

Israel’s UN Ambassador Danny Danon said in a statement on Sunday that the US and Israel “do not deserve any condemnation, but rather an expression of appreciation and gratitude for making the world a safer place.”

UN Secretary-General Guterres branded the US strikes on Iran as a “dangerous escalation in a region already on the edge – and a direct threat to international peace and security.”

“At this perilous hour, it is critical to avoid a spiral of chaos. There is no military solution. The only path forward is diplomacy. The only hope is peace,” Guterres said in a statement.


Pakistan urges OIC to transform its pronouncements on Kashmir into ‘tangible actions’

Updated 22 June 2025
Follow

Pakistan urges OIC to transform its pronouncements on Kashmir into ‘tangible actions’

  • Kashmir has been divided between Pakistan and India since their independence from Britain in 1947
  • Both countries claim the territory in full and have fought two of their four wars over the disputed region

ISLAMABAD: Pakistan’s deputy prime minister has urged the Organization of Islamic Cooperation (OIC) to transform its pronouncements on the disputed Kashmir region into “tangible actions,” the Pakistani foreign office said on Sunday, following a meeting of the OIC Contact Group on Jammu and Kashmir.

The meeting took place on the sidelines of the 51st session of the OIC Council of Foreign Ministers in Istanbul, which came in the backdrop of Israeli military campaign against Iran and Pakistan’s recent military conflict with India.

While Pakistan’s brief standoff with India ended in a ceasefire last month, Israel’s attacks on Iran were followed by US airstrikes on three Iranian nuclear facilities, raising fears of further instability in an already volatile region.

Addressing envoys of OIC member states, Pakistan’s deputy premier and foreign minister, Ishaq Dar, described New Delhi’s actions in Indian-administered Kashmir as a replication of the Israeli designs in Palestine, referring to alleged human rights violations and attempts to change demographics of the disputed Himalayan territory.

“The OIC’s pronouncements on Jammu and Kashmir are a major source of support to the Kashmir cause,” Dar said. “However, in view of the mounting challenges to the Kashmiri struggle, the OIC should transform its pronouncements into tangible actions. The Organization should scale up its efforts for mitigation of the Kashmiri people’s sufferings and finding a just settlement of the Jammu and Kashmir dispute.”

Kashmir has been divided between Pakistan and India since their independence from Britain in 1947. Both countries have fought two of their four wars over the disputed region, which is ruled in part but claimed in its entirety by both India and Pakistan.

The latest conflict between the two neighbors was also triggered by a militant attack in Indian-administered Kashmir’s Pahalgam resort town, which killed 26 tourists on April 22. India blamed the attack on Pakistan, a charge Islamabad denies.

New Delhi has long accused Pakistan of fanning an insurgency on its side of Kashmir. Islamabad denies this and maintains that it only offers moral, political and diplomatic support to the Kashmiris.

Dar said Indian authorities exploited the Pahalgam attack to launch a massive crackdown in Kashmir.

“There are reports that over 2800 Kashmiris were arrested or questioned in the immediate aftermath of the attack,” he said. “The draconian Public Safety Act was slapped on at least 75 of them. The police carried out extensive searches at multiple residences of the locals. Around three dozen houses were razed to ground through the use of explosives.”

The Pakistani deputy PM said the disturbing developments in Indian-administered Kashmir have once again shown that a peaceful settlement of the Kashmir dispute is imperative for a lasting peace in South Asia.

“The region is home to over one-fifth of the world population. It could ill-afford the consequences of irresponsible Indian actions,” he said, urging the OIC and its members to use their influence to urge India to improve the human rights situation, release political prisoners and implement relevant United Nations Security Council resolutions in Indian-administered Kashmir.


Heavy rains, lightning strikes kill at least six people in Pakistan’s northwest

Updated 22 June 2025
Follow

Heavy rains, lightning strikes kill at least six people in Pakistan’s northwest

  • A total of seven houses were damaged due to rains, strong winds and flash floods in Khyber Pakhtunkhwa province
  • The Pakistan Meteorological Department this week forecast pre-monsoon rains across various parts on June 20-23

ISLAMABAD: Heavy rains and lightning strikes killed at least six people and injured five others in Pakistan’s northwestern Khyber Pakhtunkhwa (KP) province this week, the KP Provincial Disaster Management Authority (PDMA) said on Sunday.

A total of seven houses were damaged due to rains, strong winds and flash floods that have lashed the province since June 20, according to a PDMA report. The accidents occurred in Mansehra, Buner, Lower Dir, Upper Dir, Malakand and Kohistan districts of the province.

“The deceased include three men, one woman and two children, while the injured include three men and two women,” it said.

The Pakistan Meteorological Department (PMD) this week forecast pre-monsoon rains in Kashmir, Gilgit-Baltistan and Punjab and KP from June 20 till June 23.

“The PDMA has already issued a letter to the district administrations to remain alert and take preventive measures,” it added.

Last month, rains and thunderstorms killed at least 26 people in KP and Punjab provinces, authorities said.

Pakistan has seen erratic changes in its weather patterns which have led to frequent heat waves, untimely rains, storms, cyclones and droughts in recent years. Scientists have blamed the events on human-driven climate change.

In 2022, devastating floods, blamed on human-driven climate change, killed more than 1,700 Pakistanis, affected another 33 million and caused the country over $30 billion in economic losses.