Moody’s Warns: Provoking India Could Push Pakistan Towards Bankruptcy
New Delhi (The Uttam Hindu): After the tragic terrorist attack in Pahalgam, Jammu and Kashmir on April 22, tensions between India and Pakistan are once again at their peak. The way India has taken a tough stand on this attack and the way Prime Minister Narendra Modi, Union Home Minister and Defense Minister have given strong statements like 'appropriate action' and 'to face the consequences', the sound of 'war' is being felt in neighboring Pakistan. This tough stand of India has made Pakistan lose sleep and its leaders are pleading to reduce this tension across the world.
Meanwhile, global rating agency Moody's Ratings has released an important report on Monday. The report titled 'Impact of rising tensions between India and Pakistan on Pakistan' says that if the tensions between the two countries escalate and a military conflict occurs, it will have a very serious negative impact on Pakistan's economy, while its impact on India will be quite limited.
According to Moody's report, in the event of a military confrontation, Pakistan, which is already facing serious economic crises and is trying hard to get its economy back on track, will suffer a major economic shock. This can put its foreign exchange reserves under heavy pressure and its economic growth rate can be badly affected. The report cited the limited impact on India's economic health as the reason for India's economic relations being very marginal. Pakistan's share in India's total exports in 2024 was less than 0.5 per cent. Therefore, the military tension is unlikely to cause any major disruption to India's economic activities.
It is worth noting that 26 tourists lost their lives in the terrorist attack in Pahalgam. India has identified five terrorists, including three Pakistani citizens, behind this massacre and has vowed to take decisive action against them, after which tensions between the two countries have once again increased. This report of Moody's has come at a time when political rhetoric between the two countries is intensifying and Pakistan is seeking intervention from the international community to avoid possible Indian military action.
