Author(s)

Dev Ram Gupta

Horace Mann, New York, USA.

This paper analyzes the potential economic impact of a renewed India-Pakistan war by synthesizing historical data from previous conflicts and examining current economic vulnerabilities in both countries. Drawing on past wars, including the 1971 and Kargil conflicts, it quantifies direct military costs, opportunity costs, and the long-term consequences for development and human capital. The research highlights the disproportionate burden on Pakistan’s fragile economy, which is heavily reliant on external financing and IMF support, in contrast to India’s more robust and diversified economic structure. The study also considers the risks of nuclear escalation and its catastrophic global implications. Findings indicate that while both nations would suffer severe economic setbacks, Pakistan would face a greater risk of fiscal crisis and developmental regression. The paper concludes that the economic logic overwhelmingly favors de-escalation and peaceful coexistence, as continued conflict diverts critical resources from social and economic development and threatens regional stability.

India-Pakistan War, Economic Impact, Military Expenditure, South Asia Conflict Costs, Nuclear Escalation, Pakistan Economy, India Economy, Opportunity Cost, Regional Stability

Gupta, D. (2025) The Economic Impact of an India-Pakistan War: Historical Patterns and Contemporary Analysis. Open Journal of Business and Management, 13, 2580-2588. doi: 10.4236/ojbm.2025.134136.