New Delhi, July 18, 2025:
India’s trade relations with Turkey and Azerbaijan witnessed a sharp contraction in May 2025, as diplomatic tensions—fueled by their vocal support for Pakistan during a recent India-Pakistan conflict—began to show visible commercial repercussions.

As per data released by the Directorate General of Commercial Intelligence and Statistics (DGCI&S) under the Ministry of Commerce, India’s exports to Turkey plunged by over 52%, falling from $741 million in April to $351.25 million in May. Imports from Turkey also dropped significantly from $451 million to $184.71 million, marking a 59% decline.

Similarly, India’s exports to Azerbaijan were nearly halved, declining from $14 million to $6.63 million, while imports inched up slightly to $300,000 from zero in the previous month.

Political Tensions Spill into Trade

The slump in trade volumes follows an earlier four-day military confrontation between India and Pakistan earlier this year, during which both Turkey and Azerbaijan issued statements backing Pakistan’s position. These remarks prompted strong disapproval in New Delhi and triggered a diplomatic backlash.

In the weeks that followed, Indian policymakers reportedly began reviewing broader bilateral engagements with both Ankara and Baku. While no formal trade sanctions were announced, informal curbs and a change in sentiment seem to have impacted commercial flows.

“This is a classic case of geopolitics influencing trade. Businesses are reacting to political cues, and India is clearly signaling its displeasure,” said a former Indian ambassador to Central Asia.

Calls for Boycott Gain Momentum

On social media and within industry lobbies, calls to boycott Turkish products and tourism have intensified. Influential trade bodies and political commentators have urged Indian consumers to avoid Turkish goods—especially apples, processed foods, marble, carpets, and even travel to Istanbul and Antalya.

Some retail chains have reportedly begun reconsidering Turkish sourcing, and state governments have held back on proposed memoranda of understanding (MoUs) involving Turkish firms.

A similar, though less pronounced, reaction is taking shape toward Azerbaijani trade, largely due to their symbolic support for Pakistan in multilateral forums during the conflict.

Recalibration of Foreign Trade Strategy

Insiders in the Ministry of Commerce and the Ministry of External Affairs have indicated that India is in the process of reassessing its trade and diplomatic posture toward both nations. The review could impact India’s participation in regional initiatives involving Turkey and Azerbaijan, especially those intersecting with Pakistan or Central Asia.

This recalibration appears to be in line with India’s evolving foreign policy, which increasingly links strategic alignment with commercial engagement. The trend has already been visible in recent years in India’s approach to China, Canada, and some members of the Islamic world.

“Trade cannot be insulated from foreign policy anymore. That’s the new normal,” said an official familiar with India’s current trade doctrine.

Economic Impact May Be Limited but Symbolic

Although Turkey and Azerbaijan do not rank among India’s top 20 trading partners, the sudden and steep decline in bilateral trade is noteworthy from a symbolic and strategic standpoint.

• In FY24, India’s total trade with Turkey stood at $13.2 billion, making it a moderately important partner.

• Trade with Azerbaijan, although much smaller, is strategically linked via energy corridors and Eurasian logistics routes.

Experts believe that while short-term economic loss is minimal, the message sent through trade disengagement is powerful.

“This signals to the world that India expects reciprocal diplomatic sensitivity. Support for adversaries has a price—even if it's indirect,” said a Delhi-based trade analyst.

Way Forward: Diplomacy or Further Decoupling?

Going forward, much will depend on how Turkey and Azerbaijan choose to engage with India diplomatically. If the two countries moderate their rhetoric or initiate conciliatory steps, the current slowdown in trade could be temporary.

However, if geopolitical alignments continue to diverge—particularly with regard to South Asian security, multilateral voting, and OIC resolutions—India may opt to further limit economic cooperation.

Meanwhile, Indian exporters who relied on these markets are now looking to diversify into Eastern Europe, Central Asia, and ASEAN. Several trade facilitation bodies are already assisting them in rerouting exports.

Conclusion: Diplomacy Is No Longer Just About Speeches

The May 2025 trade data provides a telling insight into how swiftly international diplomacy can shape business outcomes. As India takes a more assertive foreign policy posture under its current administration, countries that seek strategic engagement with New Delhi are likely to be measured not just by economic opportunity, but also by geopolitical behaviour.

Unless diplomatic thawing occurs soon, the India-Turkey and India-Azerbaijan trade relationships could remain chilled well beyond May.

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