How India's Call To Boycott Turkey For Supporting Pakistan Could Destroy Ankara's Economy
Last Updated:
Boycott Turkey initiative could hurt Ankara's economy, which is already grappling high inflation, currency depreciation, debt and policy paralysis
The 'Boycott Turkey' initiative by India could leave Ankara's already flagging economy in tatters with serious impact could be seen across defence, tourism, trade and investment sectors.
Since the conflict began between India and Pakistan on May 7 in the aftermath of the Pahalgan terrorist attack, Turkey has been lambasted for its role in the combat, with reports suggesting that it provided arms support to Islamabad.
Therefore, there has been a clarion call to boycott travel to Turkey and Azerbaijan as Indians question the countries' pro-Pakistan stand.
What Is The State Of Economic Affairs In Turkey?
Turkey's economic model dependent on high-interest government bonds to stabilise the lira is crumbling. The Turkish lira (TRY) has been in freefall, and the government's efforts to maintain stability are proving futile.
As of March 2025, Turkey's gross foreign exchange reserves stand at around $85 billion, net reserves, once debts and swap agreements are accounted for, hover near zero or even negative, and actual liquid reserves available for intervention may be only $20-$40 billion.
What Could Drain Turkey's Reserves?
Several factors could push Turkey's economy into a collapse.
Conversion of Lira To Dollars: If 30 million citizens exchange an average of $500 each, the central bank would lose $15 billion in reserves almost instantly. The lira would face an unprecedented collapse.
Tax Payment Boycotts: Türkiye's government is dependent on $150 billion in annual tax revenue. If 20% of taxpayers refuse to pay, the government would face a $2.5 billion monthly deficit, pushing the economy further into chaos.
Energy And Transportation Disruption: With $5 billion in monthly energy imports, even a 20% disruption could add an extra $1 billion loss per month, further depleting reserves, as per TheFeed.
Labour Shutdowns: A one-week nationwide strike would cost the economy $4-5 billion. If prolonged, the financial damage could be irreversible. If these factors collide simultaneously, Turkey could lose up to $40 billion in reserves within a single month—effectively erasing its financial safety net.
How India's 'Boycott Turkey' Will Exacerbate Downfall
Impact On Tourism: Turkey has been one of the most favoured travel destinations for Indians. However, due to Turkey's stance in the Indo-Pak conflict, major Indian travel agencies like Ixigo, EaseMyTrip, and Cox & Kings have suspended bookings to Turkey. Ixigo has suspended all flight and hotel bookings to Turkey, China and Azerbaijan. 'Respecting the sentiments shared by all Indians at this time, we have suspended all flight and hotel bookings for Turkey, Azerbaijan, and China. Our commitment is to act responsibly and in alignment with our country's broader interests, while prioritising the trust, safety, and interests of Indian travellers. Blood and bookings won't flow together," Aloke Bajpai, CEO of Ixigo, told ThePrint. Additionally, the Travel Agents Association of India (TAAI) has urged its members to halt the promotion and sale of tour packages to Turkey. This collective action is likely to lead to a significant decline in Indian tourist arrivals, adversely affecting Turkey's tourism revenue. In 2024, Turkey earned $61.1 billion from tourism, an 8.3% increase compared to the previous year. This revenue was driven by an increase in visitor numbers, with Turkey welcoming 62.2 million visitors, a 9% rise from 2023. The average spend per visitor was $972 in 2024. According to Turkey's Ministry of Culture and Tourism, 3,30,000 Indians travelled to the country last year, compared to 119,503 arrivals in 2014.
Trade Ties: Bilateral trade between India and Turkey stood at around $13.81 billion during 2022-23. India's imports from Turkey included petroleum products, nuclear reactors and parts, and various other commodities. The boycott movement has already led to actions such as traders in Pune boycotting Turkish apples. If the boycott extends to other sectors, it could disrupt this substantial trade relationship, leading to economic losses for Turkish exporters.
Investment: Turkish investments in India amount to $210.47 million, with Indian investments in Turkey at around $126 million. The current tensions may deter future investments and collaborations between the two nations, affecting long-term economic and diplomatic relations.
Defence Sector Losses: India's cancellation of a $2.3 billion shipbuilding contract with Turkey's last year TAIS consortium marks a substantial financial setback for Turkey's defence industry. The deal involved the construction of five Fleet Support Ships for the Indian Navy, with Turkish firms providing design and engineering support.
India's Boycott Turkey Call
Besides tourism industry leaders and social media users, Indian politicians have also slammed Turkey for supplying drones to Pakistan.
Shiv Sena (UBT) leader and Rajya Sabha MP Priyanka Chaturvedi rebuked a purported statement by Ankara's tourism department, which urged Indians not to 'postpone or cancel any trips" to Turkey. Sharing the statement, she wrote on X, 'No Türkiye, Indians won't come spending money on tourism in a country that uses the same to arm Pakistan. Look for your tourists elsewhere, our money ain't blood money."
Congress MLA from Himachal Pradesh, Kuldeep Singh Rathore, has called for an immediate ban on Turkish imports. Accusing Turkey of 'diplomatic betrayal", he reminded Ankara of India's assistance during the 2023 earthquake under 'Operation Dost.' 'I strongly demand that India immediately ban the import of apples and other goods from Turkey. Our countrymen must also boycott Turkish products and tourism. We cannot allow any nation to enjoy our goodwill while arming those who threaten our national security," Rathore reportedly said.
An ANI report said Pune traders have started boycotting apples imported from Turkey. 'We have decided to stop purchasing apples from Turkey and are instead opting for produce from Himachal, Uttarakhand, Iran, and other regions," Suyog Zende, an apple merchant at the Agricultural Produce Market Committee (APMC) market in Pune, told the news agency. 'This decision aligns with our patriotic duty and support for the nation."
Meanwhile, Eknath Shinde-led Shiv Sena has demanded that the management of Chhatrapati Shivaji Maharaj International Airport in Mumbai cancel the contract with the Turkish company handling the ground services. 'Turkey is helping Pakistan. How can we allow their companies to earn here? They are earning here and helping Pakistan. This will not happen," Shiv Sena MLA Murji Patel, who led the protest, said, as per Deccan Herald.
Watch India Pakistan Breaking News on CNN-News18. Get Latest Updates on Movies, Breaking News On India, World, Live Cricket Scores, And Stock Market Updates. Also Download the News18 App to stay updated!
tags :
News18 Explains Operation Sindoor turkey economy
Location :
New Delhi, India, India
First Published:
May 14, 2025, 12:09 IST
News explainers How India's Call To Boycott Turkey For Supporting Pakistan Could Destroy Ankara's Economy | Explained
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Hindustan Times
23 minutes ago
- Hindustan Times
Excise duty on liquor goes up by over 50%, retail prices to rise from 14% to 60%
MUMBAI: The cash-strapped Maharashtra government on Tuesday increased the state excise duty on Indian-made foreign liquor (IMFL) by over 50%, which will lead to a significant increase in retail prices by over 60%. It has also increased the duty on country liquor and imported premium liquor, which will hike their retail prices by 14% and over 25% respectively. The excise duty on beer and wine has not been increased. The government expects the whopping hike to increase its revenue to ₹57,000 crore, up ₹14,000 crore from the ₹43,620 crore collected in FY 2024-25. It expects 10% of the estimated revenue receipts of ₹5.60 lakh crore for the financial year 2025-26 to come from this. While tapping sources of revenue that would enable the drained exchequer to bear the burden of populist schemes like Ladki Bahin and sops for farmers and other communities, the Mahayuti government in January constituted a committee headed by then additional chief secretary Valsa Nair to recommend steps to increase revenue from liquor sales. The committee submitted its report in April this year, and the state cabinet gave its assent to this on Tuesday. Based on the recommendations of the committee, IMFL will now attract four and a half times excise duty on the manufacturing cost instead of the existing three times. 'This will vary based on the manufacturing price but could lead to a huge hike of over 60% in retail prices,' said an excise department official. The cost of IMFL currently ranges between ₹120 and ₹150 for 180 ml, which will now go up to a minimum of ₹205. Premium brands will cost a minimum of ₹360 for 180 ml as against their current rate ranging between ₹210 and ₹330. The price of 180-ml bottles of country liquor has gone up to ₹80 from the current price of ₹70. Beer and wine have been exempted from the excise duty hike. Officials said the retail price of beer, which has a lesser percentage of alcohol compared to hard liquor, is among the highest in the country and was thus exempted. In the case of wine, it is the policy of the state to promote wine since a significant chunk of the country's wineries are in Maharashtra and a significant number of farmers who supply grapes for these wineries are also based here. The government has also introduced a new category called Maharashtra-made liquor (MML), which will also be exempted from the hike. MML brands, made from grains, will cost a minimum of ₹148 for 180 ml, a price that has been strategically kept in the existing price range of IMFL to help MML capture the IMFL market. An official from the excise department said that the new category had been introduced to revive the 70 manufacturing units that manufacture IMFL from molasses and grains. 'Currently 22 of the 70 licenced units are entirely defunct while 16 do no manufacturing and renew their licence only for permission to sell liquor through their shops,' he said. 'The remaining 32 are actually manufacturing the liquor, and 10 of these produce 70% of the IMFL manufactured in the state.' The official added that distilleries using molasses would have to shift to making grain-based liquor in order to get the benefit of the exemption. The reason for this, he alleged, was that most of the grain-based manufacturing units are owned by politicians and the decision was taken to benefit them. The duty hike on IMFL brands has come after 14 years. According to officials, the excise duty levied is still lower than other neighbouring states like Madhya Pradesh and Telangana. 'The committee's recommendations were based on the study of the rates in other states,' said an officer. Another officer said that the hike in duty on country liquor brands was minimal since a greater increase and higher price would lead to the consumption of illicit liquor. 'It is also because the last hike was done in 2022,' he said. The cabinet has also allowed owners of bars to rent out permit room licences for alcohol by paying 10% of the licence fee.
Hindustan Times
23 minutes ago
- Hindustan Times
Modi government's 11 years full of achievements:MoS defence
Union minister of state for defence Sanjay Seth on Tuesday said that the 11 years of Modi government are full of achievements and remain unmatched. Seth, who addressed the media in Shimla, said that today the whole world looks at India with respect and the world's view towards India has changed. Today's India is a new India which neither fears anyone, nor bows down, nor extends hands in front of anyone. 'During the Covid-19 pandemic, when the world invented the vaccine, we invented not one but two vaccines, then the Congress party made fun of it. The Prime Minister not only saved 140 crore lives but also saved the world by giving vaccines to 118 countries,' he said. The minister of state for defence said that on PM's call, 175 countries of the world accepted June 21 as Yoga Day. 'No one believed that India would organise such a grand G-20 summit but the whole world acknowledged the success with which the government organised the summit. When the Ukraine-Russia war started, we evacuated 23,000 students from safely and students from 28 countries came out safely from there with our tricolor flag in their hands. Under Operation Kaveri, more than 3,000 Indians were brought back safely,' Seth said. The MoS further said that after the Pahalgam terror attack, the country wanted revenge and our PM said that those who were behind this incident would be razed to the ground and he did it. 'This is the first time in the world that such a huge military operation was carried out on a nuclear-armed country. Our mighty army destroyed the terrorists within 23 minutes and destroyed 11 of their air bases,' he said.
Mint
30 minutes ago
- Mint
Harman's India DTS is up for sale: Here are the top bidders
MUMBAI : Global private equity firms including Apax Partners, Bain Capital, Carlyle and General Atlantic are vying for a controlling stake in the digital transformation services (DTS) business of Harman US in India, three people aware of the development said. Harman US, a Samsung Group company, is looking at a valuation of $400-500 million for the Indian DTS business. 'Currently, the funds are doing due diligence. The second round of bids is likely only next month," one of the people cited above said on the condition of anonymity. Harman US has hired global investment bank Deutsche to help with the process. Mint was the first to report on the group's plans to sell a controlling stake in the India business on 12 May. Harman US is famous for its JBL, Harman Kardon and Infinity audio products; however, these are separate from its DTS business that's up for sale in India. Also read | Mint Exclusive: JBL maker Harman to sell controlling stake in India unit A Harman India spokesperson said, 'Harman does not comment on market speculation or rumors. As a global leader in technology and innovation across the automotive, consumer, and enterprise markets, we remain focused on delivering solutions that amplify life experiences. We are always exploring opportunities to strengthen our business, enhance our capabilities, and deliver value to our customers and stakeholders." Spokespersons for Apax and Carlyle and General Atlantic declined to comment, while Bain Capital did not respond to emailed queries. Among top brands Harman US is a Connecticut-based manufacturer of audio systems, automotive infotainment systems, lifestyle products, and connectivity solutions provider. It is counted among the top brands globally, with the majority of the revenue being derived from the automotive business and has contracts from some of the leading automotive original equipment manufacturers (OEMs). It operates in more than 30 countries. Also read | Global PE firms eye stake in Tessolve at $300 mn valuation Harman's DTS business builds systems for clients across life sciences, high-tech, and industrial and consumer sectors. It helps life sciences and med-tech companies accelerate clinical trials and modernize platforms. For high-tech firms, it helps simplify platform engineering, accelerate development, and unlock end-of-life revenue. It also helps industrial and consumer clients to operate smarter and serve better—through real-time factory insights, connected ecosystems, and enterprise systems. Revenue driver The DTS business, particularly its Indian operations, plays a crucial role in driving revenue growth for the group. India is a centre of excellence for the DTS business, with a significant number of employees based here. India is a major hub for technology development within Harman's DTS business, with a substantial workforce and a focus on key verticals like healthcare, communications, and industrial. Harman India is a wholly owned subsidiary of Harman US. It has four major business segments, namely, Lifestyle, India Development Centre, Connected Car, and Professional. Also read | Carlyle group sells 2.6% stake in Yes Bank for ₹1,775 cr via bulk deal Harman Group joins the list of global companies looking to sell or monetize their India business. 'For Harman, the DTS business is non-core to its global strategy and it is looking to monetize it," the second person cited above said. In the recent past, companies such as Thyssen Krupp, Haier and Siemens Gamesa have considered selling their Indian business and focusing on their core business. With private equity firms getting active along with domestic business houses which are hungry for inorganic growth, the deal activity in this segment is likely to pick up going forward.
