Shipping Giants Reroute as India Halts Cargo Flow to Pakistan

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Pakistan is currently grappling with a notable export dilemma as global shipping companies are steering clear of its ports. This shift follows India’s recent decision to halt the transit of vessels carrying goods from Pakistan.This ban has thrown a wrench into the works, compelling shipping firms to reroute their vessels and impose emergency fees, which onyl adds to the pressure on Pakistan’s already fragile economy.

Officials have reported that India’s restrictions have resulted in a mounting backlog of export containers at crucial Pakistani terminals. Instead of using major ports like Karachi and Qasim, carriers are now opting for alternatives such as Colombo, Dubai, and Port Klang.The Pakistan Ship Agents Association (PSAA) noted that several international shipping lines that previously loaded containers bound for Pakistan through Indian ports like Mundra have ceased these operations altogether. Recent shipping documents revealed that at least four vessels were turned away from Indian ports due to cargo destined for Karachi.

For example, the MSC Positano V-JP526R was redirected to Sri Lanka rather of making its scheduled stop at Qasim international Container Terminal on May 6. In response to this crisis,MSC has launched a new weekly service called the “Pakistan-Colombo Shuttle Service” designed specifically for transporting containers from Pakistan to Sri lanka before they continue their journey elsewhere.

On another front, French logistics giant CMA CGM has removed Karachi from several service routes and introduced an emergency Operational Recovery Surcharge (EORS) up to $800 per container for shipments heading toward destinations like the US and Australia.This surcharge will be in effect from May 15 until June 6 due to concerns over operational reliability.

As congestion continues to escalate at Pakistani ports with hundreds of export containers stuck in limbo, Khurram Mukhtar from the Pakistan Textile Exporters Association (PTEA) highlighted a growing backlog affecting exporters significantly. The textile sector alone generated $17 billion last year but is now facing severe disruptions as many companies adapt by rerouting cargo through Colombo—updates on schedules are anticipated soon.

An anonymous senior official at one major container terminal mentioned how this rerouting is inflating demurrage costs—essentially fees charged when cargo remains too long—and putting additional strain on exporters’ finances. “Shipping lines are passing extra charges onto consignees,” he explained,emphasizing how this directly impacts exports out of Pakistan.Moreover, two leading Chinese logistics firms—COSCO and OOCL—have also halted operations amid rising geopolitical tensions. COSCO announced it would stop all services heading towards Karachi while warning that ships already en route might be diverted elsewhere like Malaysia’s Port Klang. Similarly, OOCL has suspended new bookings under various services while increasing rates by about $138 per container.

Importers aren’t faring any better; Karachi Port is experiencing severe congestion exacerbated by recent strikes among transport workers since May 1st left some cargo stranded without fast clearance options available.

Air freight operations are also feeling the pinch with temporary disruptions compounding issues within trade logistics across the country. PSAA officials argue that India’s actions violate international trade norms; PSAA Chairman Mohammed A Rajpar suggested New Delhi’s strategy appears aimed at discouraging global shipping lines from engaging with Pakistani ports—a move detrimental not just economically but also against efforts supported by an ongoing $7 billion IMF loan program aimed at stabilizing recovery efforts in light of existing inflationary pressures and currency fluctuations faced by over 240 million residents in Pakistan.