Analysts are warning that the economic ramifications of rising military tensions between India and Pakistan could extend far beyond South Asia, impacting nations like South Africa that count India among their top trading partners.
Earlier this week, India’s Ministry of Defence announced the launch of Operation Sindoor, targeting nine alleged terrorist camps in Pakistan and Pakistan-occupied Kashmir.
This military action was framed by Indian authorities as a direct response to the tragic deaths of 26 civilians in Pahalgam, Kashmir, attributed to alleged terrorist attacks on 22 April. In retaliation, the Indian military has reported increased firing from Pakistan on its northern and western borders.
Given the deep interdependencies forged through trade and partnerships, particularly within BRICS—a coalition that includes both countries—these escalating tensions are raising eyebrows among economic experts in South Africa.
According to the India Brand Equity Foundation, India imported an impressive $10.54 billion’s worth of goods from South Africa in 2023-24 alone, with significant commodities such as precious stones and mineral fuels leading the charge.
Professor Emeritus of International Law at Unisa, André Thomashausen, said that India and Pakistan, after the defeat of Pakistan in the 1971 border war, signed the Shimla Treaty to manage their dispute about the autonomy for the Kashmir and Jammu territories.
“The treaty is now revoked, and the dependence of Pakistan on the waters of the Indus River is escalating the conflict, after India decided to constrain the water flows to Pakistan. China and Russia are trying to prevent an all-out war which could turn nuclear, given the imbalance of military strength,” he said.
Thomashausen added that mediation was made difficult whilst the BJP party led by Prime Minister Modi needed to win the forthcoming elections in Bihar and Uttar Pradesh, where anti-Pakistan sentiments fetch the most votes.
“If mediation fails, further severe blows to the world economy can be expected, with countries exporting to India, like South Africa, suffering most.”
University of KwaZulu-Natal academic and political analyst Siyabonga Ntombela said that escalating tensions between India and Pakistan could have significant global implications.
“Both nations are nuclear powers; if not resolved, we might have spillovers like in the Gaza-Israel war. A deterioration in their relations risks regional instability in South Asia, which could disrupt trade routes and global supply chains,” he said.
Ntombela added that for BRICS, such conflict could strain unity within the bloc and divert focus from economic cooperation to security concerns.
“Therefore, South Africa, as a BRICS member, might face diplomatic pressure to take a stance or mediate. Also, South Africa’s economic and political ties with India could be affected if the situation escalates, especially in trade and multilateral engagements.”
UKZN political science lecturer Zakhele Ndlovu said that this was a very concerning and worrying development.
“One hopes it does not spiral out of control. The world is already witnessing two major conflicts: the war between Russia and Ukraine and then the conflict in the Middle East. One hopes cooler heads will prevail. BRICS can’t afford to have two of its members involved in wars.”
Ndlovu added that the concerning part is that India and Pakistan are nuclear powers, and any escalation risks putting the whole world in danger. “India and Pakistan have fought two or three wars over the contested region of Kashmir. Obviously, this is going to have an adverse effect on the global economy.”
Professor Waldo Krugell, economist at North-West University, said that in practical terms we trade with India but it is a smaller part of our trade mix and unlikely to be disrupted by conflict in Kashmir.
“In 2023 exports to India amounted to $10.6bn, mostly gold and coal briquettes with some manganese, scrap iron, apples and pears. Our imports were $7.64bn, mostly refined petroleum, cars, trucks, packaged medicine, cell phones and rice,” Krugell said.
“Usually, conflict of any kind strengthens the dollar, but I don’t think these economies are that integrated into global markets that it would matter much. Things could escalate if China gets involved, but it is also unlikely.”
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