Nato blockade hurting trade

30 Nov 2013

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— File Photo
— File Photo

PESHAWAR, Nov 29: The disruption of North Atlantic Treaty Organisation’s (Nato) supplies via Khyber Pakhtunkhwa involves costs with repercussions for national and provincial economies greater than the jobs lost and businesses temporarily closed, say businessmen.

According to these businessmen, blockade of Nato supplies has started hurting money circulation chain, while the opportunity to generate foreign exchange is also being lost at a time when the country’s forex reserves are under pressure.

“Since Nato supply business is stalled, the money circulation capacity of local businessmen has strained and foreign exchange has also stopped coming from foreign firms,” said a forwarding agent involved in the Nato supply business.

Pakistan Tehreek-i-Insaf’s Nato supply disruption camps at five points in four districts of Khyber Pakhtunkhwa continued for the seventh consecutive day on Friday, causing increase in cost of doing business.

The forwarding agent, who requested anonymity, said the country’s capacity to receive foreign exchange from foreign contractors had been compromised.

According to him, the trucking companies dealing in Nato supplies have stuck in a dead end.

As a result, thousands of truck drivers and their support staff, customs clearance agents, and forwarding agents involved in Nato supply business are out of business.

Firms in Karachi and their forwarding agents in Peshawar and Torkham don’t have much to do right now and they are waiting for the supplies to commence, said the businessman.

“Warehouses in Karachi are filled with Nato supplies but currently, no one is even thinking to dispatch the goods via Peshawar to Jalalabad and Kabul,” he said.

According to an official source, some 150 trucks loaded with Nato supplies have stopped ahead of Khyber Pakhtunkhwa after leaving Karachi before November 23 when PTI chief Imran Khan addressed a rally at Peshawar’s Ring Road.

Hundreds of trucks were stuck across the Torkham border in Afghanistan, the forwarding agent said, adding that they were loaded with Nato supplies returning from Afghanistan.

“All those trucks that have gone off the road somewhere ahead Khyber Pakhtunkhwa on the way from Karachi would cost detention charges to the firms at the end of supply chain,” said the forwarding agent.

In such a crisis situation, he added, two types of detention charges are incurred by the company that receives the goods, raising the cost of doing business.

The forwarding agent said Rs5,000 per day ‘vehicle detention charges’ was charged by the trucking company for the number of days lost in such a situation.

Similarly, on average, $30 to $120 per day ‘container detention charges’ are also charged from the company (the final recipient of cargo either in Afghanistan or Karachi) that receives the consignment.

This affects the money circulation chain and foreign exchange in Pakistan as well, according to business circles.

“The company in Afghanistan would clear the bill (including the additional charges) after receiving the goods and till then, the Pakistani forwarding agents and customs clearance agents pay the additional charges from their pocket, getting depleted the financial reserves,” said the forwarding agent.

It creates cash flow problems for businessmen with little reserves.

Similarly, forwarding agents in Karachi receive payments in foreign currency from their clients abroad, who hire them to arrange the transportation of Nato supplies from Karachi to Kabul or Jalalabad in Afghanistan.

While Karachi’s firms receive payment from their clients in dollars, payments to trucking companies, truckers, and forwarding agents in Peshawar are made in the local currency.

“Since supplies have not originated from Karachi for one week, there is no business and as a result, no payments in foreign currency are coming either,” said the businessman.

In a news release issued on Friday, PTI has claimed the success of its campaign continuing for seven consecutive day across the province.

Its workers continue to subject drivers of trucks to show customs papers of the cargo en route to Afghanistan, inspecting that the cargo is being transported under the regular trade with Afghanistan or meant for Nato forces.

Meanwhile, Usman Bashir, vice president of the Pakistan-Afghanistan Joint Chamber of Commerce and Industry, said highhandedness of workers of a political party had implications for regular trade and the business of Afghan Transit Trade.

In a news release, he demanded of the provincial government to order police to take action against the Nato supplies’ disrupters and ensure smooth flow of transporters en route to Afghanistan.

“The political party’s workers are creating problems for regular trade transportation under the garb of blocking Nato supplies and as a result, trade between Pakistan and Afghanistan will suffer,” he said.

Also, a senior customs department official told Dawn that truckers coming via Dera Ismail Khan on the way to Peshawar for onward journey to the Torkham border town had complained of facing difficulties.

“Things have streamlined to a greater extent in Peshawar and elsewhere except for Dera Ismail Khan where truckers have experienced issues due to (protest of) PTI workers,” he said.

The official said no untoward incident had been reported anywhere in Khyber Pakhtunkhwa, but the PTI-Jamaat-i-Islami campaign had slowed down trade and business activities relating to trade with Afghanistan.

“Previously if 20 to 30 trucks carrying regular trade items were passing through Peshawar on the way to Afghanistan, now their number has shrunk by 30 per cent to 40 per cent,” he said.