For a start, no amount of civilian market or commodity could replace a defence market.
We are in WTO and are bound to have trade with Pakistan inspite of what happens in LOC. So unless and untill there is a diplomatic fallout, trade would exists in between two countries directly or indirectly. Do you think US made cars have gone out of sale in Iran? Do you think the wheat import from US has seized in Iran?
Civilian market would always exist no matter what. But its the defence or arms market which shows the level of confidence a government have on you. So in political terms, defence market means a lot.
The assumptions made are not fully justified. I would like to clarify.
The main assumption is that larger volume and value of arms sale means a closer relationship both political and strategic.
Let us compare
Saudi Arabia. and Canada
US arms sales to each in the year 2018.Source usatoday. com
3.35 billion us dollars. 121 million us dollars
By extending the logic of the assumption the US must have a stronger relationship with Saudi Arabia than with Canada.
But in reality it is exactly the opposite. The US has deep ethnic, religious and cultural ties with Canada which leads to both political and strategic convergence.
Saudi Arabia is important only for its oil and in a crisis the US will not sacrifice Canada for Saudi Arabia.
US exports to Canada in the year 2018 were 300 us billion dollars. Compare with arms exports of only 121 us million dollars.
Source. Trading Economics. tradingeconomics. com
The US arms exports to Canada form only 0.00040 % of total US exports to Canada. In spite of such low arms sales the US-Canada relationship is cast in iron.
I do agree that arms sales have both political and strategic dimensions. But quantity of arms sales alone does not dictate the level of closeness between 2 nations. A country may not even sell arms to a particular state but still have a deep political and strategic relationship with it.
I will give two more examples to cla further.
Let us take the case of Japan. and Mexico
Arms exports by the US to both in 2018 are
Japan. 675 million US dollars. Mexico. 18 million USdollars
Source. USA Today. usatoday. com
Now let us look at total US exports to both in 2018
Japan. 75 billion us dollars Mexico 265 billion us dollars
Source Trading Economics. tradingeconomics. com
The US sells arms worth only 18 million us dollars to Mexico but has a strong relationship with it. Similarly for Japan.
I conclude.