Pakistan ports face export backlog as India's transit ban forces shipping lines to reroute
The disruption has led several global shipping companies to impose emergency operational surcharges on Pakistani cargo, citing the 'significant impact' of regional geopolitical tensions on their operations.
The move is expected to raise shipping costs and, ultimately, consumer prices in Pakistan, a country of over 240 million people already grappling with economic challenges.
'The European shipping services are bypassing Pakistan ports after India's ban on the transit of ships loaded with cargoes from Pakistan,' said Syed Tahir Hussain, Secretary General of the Pakistan Ship Agents Association (PSAA).
He accused New Delhi of attempting to undermine Pakistan's recovering economy, which has shown signs of stabilization under the International Monetary Fund's (IMF) $7 billion loan program.
PSAA Chairman Mohammed A. Rajpar called India's move 'unwarranted' and against international conventions, saying it was designed to discourage shipping lines from calling at Pakistani ports.
The situation comes as Islamabad is attempting to break free from its boom-and-bust economic cycles by boosting exports, which rose 6 percent to $27 billion through April, according to the Pakistan Bureau of Statistics.
Until recently, many international shipping services transited Pakistani cargo through India's largest ports — Mundra and Nhava Sheva — by loading what is termed Remaining On Board (ROB) freight.
However, India embargoed this practice last week, prompting several carriers to remove Pakistani ports from their routes and instead launch dedicated feeder services to handle trade valued at approximately $87 billion last year.
Most of Pakistan's containerized cargo is handled through the South Asia Pakistan Terminal (SAPT) operated by CH Hutchison Holdings, Qasim International Container Terminal (QICT) run by DP World and the Karachi Gateway Terminal managed by Abu Dhabi Ports Group.
'Some vessels carrying Pakistan's exports sailed from QICT were not allowed berthing in India,' said Hussain, whose association represents over 50 international shipping lines.
'They had to divert to Dubai and other nearby ports,' he added, without specifying when the incident occurred.
Shipping documents seen by Arab News show that at least four vessels were denied entry by Indian authorities earlier this week due to 'Karachi onboard cargo.' These ships were rerouted to Colombo in Sri Lanka and Jebel Ali in the United Arab Emirates.
Swiss carrier MSC Mediterranean Shipping redirected all destination cargo via Colombo aboard its vessel MSC Positano V-JP526R, which had been scheduled to call at QICT on May 6.
This change, MSC said in a customer notice, was 'due to the current geopolitical situation and restrictions on imports and exports via/from India.'
French shipping giant CMA CGM has removed Karachi from at least four of its service routes, citing the need to adjust operations to and from Pakistan.
'BIG BACKLOG' AT PORTS
Export congestion is building at Pakistani ports as hundreds of containers await shipment.
'There is big backlog,' said Khurram Mukhtar, Patron-in-Chief of the Pakistan Textile Exporters Association (PTEA).
Textiles remain Pakistan's largest export sector, contributing $17 billion last year.
Mukhtar noted that most shipping lines were now planning to route exports through Colombo, with system updates expected by Monday.
MSC has launched a 'Pakistan-Colombo Shuttle Service,' a weekly feeder vessel that will transport export containers to Sri Lanka for onward connections to global destinations.
Amid the ongoing crisis, international shipping lines have begun imposing surcharges on Pakistani exporters and importers.
CMA CGM has introduced an Emergency Operational Recovery Surcharge (EORS) of up to $800 per container for shipments to the US, Latin America and Australia, effective from May 15 through June 6.
The French firm said the surcharge was necessary to maintain service reliability and safety during this period. CMA CGM operates more than 250 routes globally with a fleet of 650 vessels.
'Pakistan's exports are suffering,' said a senior official at one of Pakistan's major container terminals, speaking on condition of anonymity.
'This will lead to the buildup of a huge container backlog at Pakistani ports,' the official said. 'There will be issues like port demurrages. The shipping lines will be charging the consignees with detentions.'
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Asharq Al-Awsat
2 hours ago
- Asharq Al-Awsat
US Designates Baloch Separatists as a Terror Group over Role in Attacks in Pakistan
The United States designated a Pakistan separatist group as a foreign terrorist organization, the State Department said, a move hailed Tuesday by Pakistani officials. The designation of the Balochistan Liberation Army and its fighting wing, the Majeed Brigade, blamed for deadly attacks in Balochistan province, coincides with a visit to the US by Pakistan´s army chief, Field Marshal Asim Munir. The announcement comes less than two weeks after Washington and Islamabad reached a trade agreement expected to allow US firms to help develop Pakistan´s largely untapped oil reserves in resource-rich Balochistan and to lower trade tariffs for Islamabad, The Associated Press said. The State Department is "designating the Balochistan Liberation Army (BLA) and its alias, the Majeed Brigade, as a Foreign Terrorist Organization (FTO), and adding the Majeed Brigade as an alias to BLA´s previous Specially Designated Global Terrorist (SDGT) designation," the agency said in a statement. The BLA was first designated a terrorist group in 2019 by the US Treasury Department after several attacks. The State Department said its designation was added because since then the group has claimed responsibility for additional attacks. The BLA claimed responsibility for suicide bombings near the airport in Karachi and in the port city of Gwadar in Balochistan in 2024, the statement said. The group said it carried out the March hijacking of the Jaffar Express train traveling from Quetta to Peshawar, killing 31 civilians and security personnel and holding more than 300 passengers hostage, the State Department said. "Today´s action taken by the Department of State demonstrates the Trump administration´s commitment to countering terrorism," the US statement said. Syed Muhammad Ali, an Islamabad-based security analyst, said the designation of the BLA and its Majeed Brigade fighting wing follows Munir´s visits to the US. The designation "indicates a major policy shift by the Trump administration toward South Asia, highlighting the growing role of military diplomacy, deepening bilateral cooperation on counterterrorism, and showing that Washington shares Pakistan´s security concerns about Baloch insurgents," he said. The change also shows the US values stability in Pakistan and its oil- and gas-rich Balochistan province, Ali said. There was no immediate comment from Balochistan nationalists and separatist groups. Balochistan has long been the scene of insurgency, mostly blamed on groups including the key outlawed Baloch Liberation Army, which the US designated a terrorist organization in 2019. The province is also home to militants linked to the Pakistani Taliban. Separatists in Balochistan have opposed the extraction of resources by Pakistani and foreign firms and have targeted Pakistani security forces and Chinese nationals working on multibillion-dollar projects related to the China-Pakistan Economic Corridor. Though Pakistan's government says it has quelled insurgency, violence persists in Balochistan, where troops last week killed 47 insurgents in two separate operations in the Zhob district. The military said Tuesday it killed three additional insurgents in Zhob, raising the number of militants killed to 50 since Thursday. An explosion on Tuesday ripped through an arms depot in Nowshera, a district in northwestern Khyber Pakhtunkhwa province, residents said. There was no immediate statement from police or the military, but authorities were expected to release a statement.
Arab News
11 hours ago
- Arab News
'You can't snatch even a drop,' Pakistan warns India against restricting Indus waters
ISLAMABAD: Pakistan on Tuesday warned India against restricting the flow of its share of the Indus waters, saying New Delhi could not 'snatch even a drop' of water from Pakistan. India announced in April it was putting the 1960 World Bank-mediated Indus Waters Treaty (IWT), which ensures water for 80 percent of Pakistani farms, in abeyance a day after an attack in Indian-administered Kashmir that New Delhi blamed on Pakistan, an allegation Islamabad denies. The IWT grants Pakistan rights to the Indus basin's western rivers — Indus, Jhelum, and Chenab — for irrigation, drinking, and non-consumptive uses like hydropower, while India controls the eastern rivers — Ravi, Beas, and Sutlej — for unrestricted use but must not significantly alter their flow. India can use the western rivers for limited purposes such as power generation and irrigation, without storing or diverting large volumes, according to the agreement. Pakistan has previously said the treaty has no provision for one side to unilaterally pull back and that any blocking of river water flowing to Pakistan will be considered 'an act of war,' while Islamabad said on Monday that the Court of Arbitration in the Hague last week issued a ruling with regard to the design of new Indian hydro-electric power stations on the western rivers that was in line with Pakistan's interpretation of the relevant provisions of the treaty. 'I want to tell this to the enemy today that you threaten to cut off our water, remember this you cannot snatch even a drop of Pakistan's share [of Indus water],' Prime Minister Shehbaz Sharif said at a ceremony in Islamabad. 'If you attempt such an act, we will again teach you such a lesson that you will regret it.' Pakistan had brought a case to the Hague-based Permanent Court of Arbitration in 2023 over the design of Indian hydro-power projects on rivers that were awarded to Pakistan under the IWT. In a ruling on Friday that was posted on its website on Monday, the court said it had jurisdiction over the dispute and ruled the treaty 'does not permit India to generate hydro-electric power on the Western Rivers based on what might be the ideal or best practices approach for engineering' of these projects. Instead, the design of these projects must adhere 'strictly' to the specifications laid down in the treaty, the court said. Pakistan's Attorney General, Mansoor Usman, said in an interview on Tuesday that, by and large, the court had accepted Pakistan's position, especially on the design issue of the new hydropower projects. 'I am sure it is clear now that India cannot construct any of these projects in violation of the court's decision,' he told Reuters. Pakistan's foreign ministry said late Monday that the court ruling said that India had to 'let flow' the waters of the three rivers for Pakistan's unrestricted use. The court said its findings are final and binding on both countries, according to the foreign office statement. But an Indian official pointed to a June statement by India's foreign ministry, which said that New Delhi has never recognized the existence in law of the Court of Arbitration. Pakistan and India engaged in a four-day military conflict in May this year, attacking each other with fighter jets, missiles, drones and artillery. The standoff killed around 70 people on both sides before the United States announced a ceasefire on Monday, although India denies agreeing to the truce on the request of Washington.
Asharq Al-Awsat
11 hours ago
- Asharq Al-Awsat
Iraq Considers Oil Exports via Lebanon's Tripoli Port, to Study Reviving Iraq-Syria Pipeline
Iraq's oil ministry is considering exporting oil through Lebanon's Tripoli port and will study reviving the dormant Iraq-Syria oil export pipeline, it said on Tuesday. The ministry plans to form a joint committee to assess the pipeline's condition. The announcement came during a visit by Syria's energy minister to Baghdad to discuss cooperation in oil, gas and energy. Iraq dispatched a high-level delegation to Damascus in April to assess the feasibility of reviving the Iraq–Syria oil pipeline, a move Baghdad is counting on to diversify export routes amid expanding production capacity.
