Supply chain crisis paralyzes Pakistan's Trade: APTMA

More than 25,000 export containers are stranded across Sindh province, unable to reach ports due to paralyzed cargo movement, while another 50,000 containers carrying imported and local goods remain stuck on roads because of widespread blockages, industry leaders said Monday.

The All Pakistan Textile Mills Association (APTMA) called for urgent government intervention, warning that the backlog could take weeks to clear even if road access is restored.

At a press conference, APTMA Chairman Kamran Arshad said the crisis has brought supply chains to a halt, risking millions in export orders and crippling manufacturing.

Demonstrations opposing the proposed canal project from the Indus River are intensifying across Sindh, causing widespread disruption to road transportation and halting judicial activities in multiple districts.

"This is a national crisis that demands immediate action," Arshad said, appealing to Prime Minister Shehbaz Sharif, Sindh Chief Minister Syed Murad Ali Shah, and Pakistan Peoples Party Chairman Bilawal Bhutto Zardari to resolve the logistics deadlock, which began April 19.

Arshad warned that industries face "operational chaos," with production slowing and potential losses reaching hundreds of millions of dollars. The disruptions, he said, threaten Pakistan’s standing in global markets and could devastate the economy.

Tax Policy Disparities Worsen Crisis

Arshad also criticized anomalies in Pakistan’s Export Facilitation Scheme (EFS), arguing that the removal of sales tax exemptions on local supplies—while maintaining duty-free imports—has severely hurt domestic textile producers. He said around 120 spinning mills, accounting for 20-25% of yarn production, and over 800 ginning factories have shut down due to the uneven tax structure.

"The remaining mills are operating at half capacity and may close soon," he said, warning of massive job losses and a collapse in demand for local cotton, which would leave farmers without income.

He urged the government to revert the EFS to its June 30, 2024, terms, restoring tax exemptions for local suppliers or imposing equivalent tariffs on imports.

Export Orders Canceled as Buyers Shift Suppliers

Asad Shafi, APTMA’s North Zone chairman, said international buyers are canceling orders and turning to competitors due to shipment delays. "If this continues, Pakistan risks deindustrialization and a permanent loss of export revenue," Shafi said, demanding immediate policy corrections.

The association warned that without swift action, the crisis could trigger widespread factory closures and deepen economic instability.