India has strongly refuted claims circulating in Pakistani media that it has suspended trade with Afghanistan via the Iranian route, dismissing the reports as “propaganda” aimed at undermining growing Indo-Afghan economic ties.

The Indian Embassy in Kabul issued a statement Tuesday clarifying that trade continues uninterrupted through Iran’s Chabahar Port, a strategic gateway that has become increasingly vital to landlocked Afghanistan’s international commerce. The diplomatic mission characterized the false reports as a deliberate misinformation campaign designed to create uncertainty in the market.

“We have noticed baseless propaganda regarding suspension of trade between India and Afghanistan through Iran. This is completely false,” the embassy stated. “Trade continues as normal through established routes, including via Chabahar Port, which remains fully operational.”

The controversy comes at a significant moment for regional trade dynamics. Since the Taliban returned to power in Afghanistan in 2021, India has strategically positioned itself as a crucial economic partner for the struggling nation. Despite not officially recognizing the Taliban government, New Delhi has maintained economic engagement through humanitarian aid, infrastructure development, and trade initiatives.

Trade between India and Afghanistan reached approximately $1.5 billion in the 2022-2023 fiscal year, according to Indian commerce ministry data. Key exports from India include pharmaceuticals, textiles, and agricultural machinery, while Afghanistan primarily exports dried fruits, nuts, and carpets to the Indian market.

The Chabahar Port has emerged as a cornerstone of this commercial relationship. Located in southeastern Iran, the port provides Afghanistan with sea access that bypasses Pakistan, historically Afghanistan’s dominant trade corridor. India has invested over $100 million in developing the port’s infrastructure as part of its broader strategy to enhance connectivity with Central Asia while reducing Pakistan’s regional influence.

Economic analysts note that the false reports appear timed to coincide with recent trade delegations between India and Afghanistan. Last month, a high-level Afghan business delegation visited New Delhi, resulting in several trade agreements valued at approximately $250 million, focusing primarily on agricultural products and textiles.

“These disinformation attempts reflect growing anxiety over India’s expanding economic footprint in Afghanistan,” said Rahul Sharma, a South Asia trade expert at the Delhi Policy Research Institute. “The Chabahar route represents a paradigm shift in regional trade architecture that diminishes traditional leverage points.”

Pakistani media outlets had claimed that India suspended trade operations through Iran following alleged security concerns and logistical challenges. These reports suggested that India was retreating from its commitments to Afghan economic stabilization—a narrative quickly countered by both Indian officials and Afghan business leaders.

The Afghanistan Chamber of Commerce and Industry also confirmed that trade flows remain normal, with no disruptions reported along established routes. “Our members continue to receive and send shipments through Chabahar without issue,” said Mohammad Yunus Mohmand, Acting Chairman of the chamber, in a statement released from Kabul.

The trade relationship holds particular importance for Afghanistan’s struggling economy, which has faced severe contractions following international aid reductions after the Taliban takeover. The World Bank estimates Afghanistan’s GDP contracted by approximately 20% in 2021, with minimal recovery since then.

Indian officials emphasized that economic engagement with Afghanistan remains guided by humanitarian considerations rather than political recognition of the current regime. This approach has allowed trade relationships to continue despite diplomatic complexities.

“India remains committed to being a reliable partner in Afghanistan’s economic development journey,” the Indian Embassy statement concluded. “Any claims to the contrary represent deliberate attempts to damage growing commercial ties between our nations.”

Regional observers suggest that as competition for influence in Afghanistan intensifies, economic diplomacy has become a primary battlefield, with trade routes and commercial relationships serving as crucial leverage points for regional powers including India, Pakistan, China, and Iran.