ISLAMABAD: A recent study by Dr Usman Chohan, adviser at the Centre for Aerospace and Security Studies (CASS) in Islamabad, estimates that India’s economy suffered a staggering $30 billion in losses during just five days of military escalation with Pakistan.
The study breaks down the losses into three major categories: aviation-related costs, market decline, and broader external disruptions.
Aviation-related costs
In the aviation sector, the downing of five aircraft reportedly caused $1 billion in damages, while the loss of 77 drones added another $100 million.
Additional flight operation costs during the heightened alert further contributed to the financial strain.
Market decline
The most significant impact, however, came from the stock market. A modest decline of 1.66 per cent in India’s $1.57 trillion stock market erased $28 billion in market capitalisation. According to Dr Chohan, continued escalation could lead to a steeper drop of up to five per cent, translating into potential losses of $87 billion as investor confidence wanes.
External disruptions
The third component involved broader economic disruptions, including the suspension of the Indian Premier League (IPL), which alone accounted for an estimated $1 billion in losses. Disruptions at seaports, airports, and to air travel further compounded the damage.
The study warns that if tensions persist, the economic fallout could escalate dramatically, further weakening investor confidence and economic stability in the region.
