March 26, 2003	Wednesday	Muharram 22, 1424

LAHORE, March 25: As the US-led war in Iraq is likely to continue for a while, the worries of higher oil prices, increased freight charges and a possible cancellation of export orders have started to haunt the local businessmen.

“Our exports are going to suffer immensely should the war goes on for a longer period because it would add to uncertainty in the international trade,” said former Aptma chairman Abid Farooq. The oil prices are sure to shoot up if the Iraq crisis lingers for an indefinite period, causing the cost of raw materials to increase. The freight charges will also remain high.

In addition, he said, “Pakistan’s exports to the US would also suffer in case we take a firmer stand against the war as it might outrage the American public opinion.” The US public, he said, had already stopped purchasing the goods/items made in France because of its consistent opposition to the US-led invasion of Iraq.

Mr Farooq warned that Pakistan’s businessmen could also face a similar problem in the American market if the tension with the US on this issue escalated owing to its opposition to the US dictates on the issue in the coming days. However, he added, “we would not face such problem in Europe where most countries, barring the UK, have been opposing the invasion of Iraq.”

He, however, stated no export order had so far been cancelled. “But cancellation of orders in future cannot be ruled out because the Gulf crisis is certainly going to create problems. It’s going to be a different and difficult business environment once the war is over. It may become more difficult for us to travel abroad and for the buyers to visit us if the crisis lingers on.”

Lahore Chamber of Commerce and Industry (LCCI) president Yawar Irfan Khan urged the government to prepare a contingency plan for coping with possible energy crisis as a consequence of the events in the Gulf. “We should arrange to purchase oil from Iran because the crisis may engulf some neighbouring states of Iraq if the war there prolongs.”

He was of the opinion that the longer the duration of the war, the bigger its impact on Pakistan’s economy in the shape of lower remittances (as the Pakistani workers in the Gulf countries would be forced to come back), increased shipping charges, reduction in local spending, cancellation of export orders, and higher cost of production.

A leading businessman, Mr Nabeel Hashmi, said “exports from the country are certain to stagnate, even if these do not decline, as a result of the Iraq crisis.”