Tension between India and Pakistan may be high following a deadly militant attack on an army base in the town of Uri in Kashmir. This, however, will not have any adverse impact on the value of rupee (Indian currency) given the insignificant official trade between the two countries, say bankers and currency experts.
“Impact of this (ongoing tension following the Uri attack) on rupee will be minimal as bilateral trade is not significant,” V Kannan, former Chairman & Managing Director of Vijaya Bank, told BusinessLine .
Ajay Sahai, Director General and Chief Executive Officer, Federation of Indian Export Organisations (FIEO), said that Pakistan is not a significant trade partner for India.
The ongoing developments will have no impact on rupee unless this escalates into a war, he noted.
“Trade levels are also coming down each year. There is also nothing on foreign direct investment into India from Pakistan,” Sahai said.
Trade may get disturbed and cross border movements are bound to get affected due to fear in the minds of people on account of this development, said experts.However, the overall bilateral trade is not that significant to have any adverse impact on rupee. There are no inbound investments from Pakistan also.