Karachi container logjams could soon begin to ease
06/02/2023
It is suggested that more than 95% of the containers are being held due to the non-opening of letters of credit and various import restrictions imposed by the nation’s central bank. The backlog began to build in July.
Following last year’s heavy flooding between June and October, said to have decimated around 40% of the country’s annual cotton crop, in addition to significant gas supply issues in recent months, local textile producers have become more reliant on imports of fibres, chemicals, components and more, just to be able to fulfil regular customer orders. This has made them increasingly vulnerable to supply chain delays.
In a sign of the times, data published by industry representative body the All Pakistan Textile Mills Association (APTMA) suggests that textile exports declined by roughly 12% year on year to $1.36 billion in January.
Over the first seven months of the current fiscal year, which began last July 1, equivalent exports saw an 8% year-on-year drop to $10.08 billion, APTMA added, emphasising the ongoing Ukrainian conflict and its ripple effect.
Minister of maritime affairs Faisal Subzwari announced late last month that the government would waive 100% of port authority charges to help ease the logjam. The dollar-strapped State Bank of Pakistan said that containers would begin to clear if importers could agree to self-fund payment on a 180-day deferred basis.
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