Partly Wrong: The Middle East Conflict Did Nudge Inflation in Pakistan and India — But It Wasn't the Main Driver

The claim holds that the Middle East conflict — particularly the Israel-Gaza war starting October 2023 — pushed up fuel and logistics costs and fed inflation in Pakistan and India. The verdict is partially false. There is a real but limited connection, and it is being significantly overstated.

Pakistan's inflation crisis was already in full swing before the Middle East conflict began. The Pakistan Bureau of Statistics recorded a CPI peak of 38.4% in May 2023. The IMF's 2023 Article IV report on Pakistan traced this to domestic causes: a collapsing rupee, removal of energy subsidies under IMF conditions, and chronic fiscal mismanagement. The Russia-Ukraine war, which disrupted global energy and food commodity markets from early 2022, was the dominant external shock — not events in Gaza.

India's picture is similar. The Reserve Bank of India's 2023-24 Annual Report found that food price volatility and domestic supply shocks drove Indian inflation, which stayed relatively contained at around 5.4% in FY2024. The RBI explicitly noted that the Israel-Hamas conflict had limited direct inflationary impact, partly because India sources energy from a wide range of suppliers. India's Ministry of Finance acknowledged Red Sea disruptions added logistics costs but described them as a secondary factor.

To be fair to the claim, there is a real thread worth following. UNCTAD's 2024 maritime transport review documented that Houthi attacks on Red Sea shipping — carried out in solidarity with Gaza — sent container freight rates up by 200 to 300% in early 2024. For import-dependent economies like Pakistan, that kind of shipping cost spike does eventually pass through to consumer prices. The World Bank's April 2024 Commodity Markets Outlook confirmed the Middle East conflict had a modest upward effect on global oil prices. So the conflict was not irrelevant — it just was not the engine.

This kind of claim spreads because distant geopolitical crises make intuitive scapegoats for economic pain that is harder to explain closer to home. Blaming a war in the Middle East is emotionally satisfying and sidesteps uncomfortable conversations about currency mismanagement, subsidy policy, or supply chain fragility. When evaluating inflation claims, always check the timeline: if prices were already rising sharply before the cited event, that event cannot be the primary cause.