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October 25, 2019

Exporters in a lurch as govt impounds containers to counter protests

Business

October 25, 2019

 Containers are being placed to block the road leads towards Red Zone area due to expected protest of Azadi March, in Islamabad on Wednesday, October 23, 2019. -PPI

LAHORE: Government’s commitment to give top priority to exports stands fully exposed, as it has according to some estimates impounded 4,000 containers mostly carrying export consignments, to check the Azadi March of Maulana Fazalur Rehman.

More: JUI-F’s anti-govt long march to start in Karachi on Sunday

This practice has been in vogue in Pakistan during all agitations and strikes to stop the agitators from gathering at one particular spot where they announce to protest on a particular date. But the magnitude of container impounding this time is mind blowing.

The impounding started a week before the proposed march and continues unabated. Any container that leaves a mill or factory fully loaded with export consignment gets impounded.

All containers from upcountry are booked for Karachi from where they are loaded on ships waiting for goods at the Karachi sea port. These ships follow a strict schedule. If the consignment does not reach the port in time these ships leave for other destinations.

Pakistan’s major exports are textiles that have to be delivered to the global consumers within the promised date. When a ship leaves Karachi port without export goods, the chances of timely delivery vanish as few ships touch our ports and the next ship might come late.

The exporters are rightly worried because they have no idea as to when these containers would be released. If the Azadi March is converted in to Imran style dharna it would ruin the chances of delivering these export goods even by air.

Pakistan has paid heavy price for such unethical interventions by authorities. Buyers refuse to accept the goods that are delivered late.

They have a point, as the textile goods are ordered in line with the ongoing season and fashion. If delivery gets late by 15, days they would lose the prime selling time and would be left with huge unsold stock.

When they refuse to accept the consignment the exporter is ordered to take it back to his country. He has to pay the freight and demurrages.

Sometimes they are unable to dispose of their stuff in their own country as it was meant for a particular country and culture. Pakistani exporters have paid heavy price for such forced late deliveries in the past.

When Benazir Bhutto was murdered, thousands of containers could not reach Karachi due to riots in Sindh. The containers remained stranded at different places for over 10 days.

It was unfortunate that over 40 containers belonging to the then top exporter of home textiles Chenab Group got stranded on the Faisalabad- Karachi route.

The buyer refused to accept the consignment and goods worth hundreds of millions were shipped back to Pakistan. The company caved in after that incidence.

Chenab was a large group, but most of the value-added exporters in textiles are small and medium-sized companies. For them, one consignment might account for 100 or 50 percent of their liquidity.

Inability to execute their orders in time would ruin them and without their fault. Using export containers to stop agitation is not the proper way.

We badly need our exports to grow. One expected this government to act differently. There was not even a muted protest from those looking after the exports of the country.

Prime Minister’s Advisor on Commerce, Razzak Dawood should have strongly protested the confiscation of export consignments. In fact, he should have resigned in protest.

But normalcy persists in the commerce division. Exports are already inching up at a snail’s pace and the recent impounding of containers would be a great blow to the exports.

Luckily the export industries in Karachi were largely spared, but then Sindh including Karachi accounts for only 30 percent of our exports. Around 70 percent exports are executed from upcountry and all the upcountry exporters are badly suffering.

The authorities should come up with an urgent solution to this problem to save the exporters and reputation of the country as a reliable timely supplier of goods.

The exporters on their part have made great efforts to prove themselves as very reliable suppliers, but this time around, the fault lies with the government, which seems bent upon tarnishing the image of the country.

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