Escalating hostilities in the Gulf region pose a significant threat to Pakistan’s fragile economy, potentially disrupting vital remittance inflows, trade routes, and energy supplies, warned Malik Muhammad Bostan, Chairman of the Exchange Companies Association of Pakistan (ECAP). The warning comes as hundreds of international flights face cancellations and fears grow over potential fuel shortages and rising import costs.
Commenting on the developing situation, Bostan described the combination of ongoing regional conflicts, including violence in Palestine and rising tensions on the Pakistan-Afghanistan frontier, as a “deeply troubling scenario” for the Muslim world. He underscored the need for unity and coordinated, effective measures to protect shared economic and strategic interests during these critical times.
Bostan highlighted the Middle East”s role as a key economic partner for Pakistan, noting that millions of Pakistani expatriates in Gulf nations are a crucial source of foreign exchange through their remittances. He cautioned that prolonged instability could jeopardise these financial inflows and disrupt trade at a moment when Pakistan”s economy is already navigating considerable challenges.
The immediate effects are already being felt in the aviation sector, with recurring airspace closures in several Middle Eastern countries forcing the cancellation of hundreds of flights from Pakistan”s main international airports. Flights to key destinations such as Saudi Arabia, the UAE, Qatar, Kuwait, and Bahrain have been disrupted, affecting thousands of travellers and causing financial losses for airlines.
Concerns also extend to maritime trade, where shipping disruptions in parts of the region have created uncertainty for both exporters and importers, the ECAP chairman noted. A sustained conflict could severely affect vital trade routes, leading to delayed consignments and an increased cost of doing business.
Emphasising Pakistan”s significant dependency on imported fuel, Bostan warned that disruptions to the supply chain could trigger petroleum shortages and a sharp rise in domestic fuel prices. He added that climbing global crude oil prices would inflate the nation”s import bill, placing further strain on its foreign exchange reserves.
Bostan urged Pakistani policymakers to monitor the situation closely and to implement timely and proactive measures to cushion the economy against the potential fallout.