INDIA HITS BACK

Pakistan's benchmark KSE-100 index crashes after India hit terror targets there and in PoK

- RAHUL OBEROI

HOURS AFTER INDIA launched strikes on terror camps and infrastructure at nine locations in Pakistan and Pakistan-occupied Kashmir in the early hours of May 7, the stock markets of the two countries showed a very divergent trend.

The Indian strikes, part of Operation Sindoor, came two weeks after terrorists killed 26 people, mostly tourists, in Pahalgam in the Kashmir Valley. The Indian armed forces targeted the headquarters of Lashkar-e-Taiba and Jaish-e-Muhammad, Indian officials said.

Pakistan’s KSE-100 index crashed 6,500 points, or 6%, intra-day, on May 7. It fell further on May 8 as well, forcing the Pakistan Stock Exchange to halt trading briefly. In contrast, the Indian stock markets remained almost unaffected.

Global rating agency Moody’s has warned that any sustained escalation between the two countries could severely undermine Pakistan’s already fragile economic stability. That is significant considering the relative gulf in the sizes of the two economies. The International Monetary Fund’s data shows that India’s GDP stands close to $4.2 trillion compared with a meagre size of Pakistan economy, which stands at nearly $0.37 trillion.