Muhammad Saleem Memon of the Hyderabad Chamber of Small Traders and Small Industry has expressed serious concern over the escalating geopolitical tensions in the Middle East, particularly the potential closure of the Strait of Hormuz. He stated that this situation poses significant risks to Pakistan’s industrial and commercial activities.
He noted that changes in global shipping routes, disruptions in cargo bookings, and the imposition of war risk surcharges ranging from $1,500 to $3,500 per container by shipping companies have created severe challenges for domestic industries, especially those in Hyderabad. Additionally, delays of 15 to 20 days in the delivery of raw materials, along with a sharp increase in freight costs, are adversely affecting industrial production and putting the timely fulfilment of export orders at serious risk.
He further stated that industries in Hyderabad are already struggling with multiple challenges, including an ongoing energy crisis, high electricity tariffs, gas shortages, and the depreciation of the Pakistani rupee. The recent increase in diesel prices by Rs. 55 per litre has further escalated inland transportation costs by 15% to 25%. As a result, production costs for industrial units are continuously rising, making business planning increasingly difficult.
Chamber President Saleem Memon, alarmed that if the current situation persists, Pakistan’s key export sectors, particularly value-added textiles, could see a 10% to 20% decline. This would not only put additional pressure on foreign exchange reserves but also lead to the closure of small and medium enterprises (SMEs), resulting in increased unemployment.
He urged the Government of Pakistan to take immediate emergency measures, emphasising that a comprehensive and effective strategy is now essential to safeguard the industrial sector. He called for the provision of subsidised fuel for industries, an immediate reduction in electricity tariffs, freight subsidies for exporters, and an expansion of export refinance facilities through the State Bank of Pakistan to support export activities.
He also suggested that the government should seriously explore B2B barter trade opportunities with regional countries and ensure alternative shipping routes and fuel supply mechanisms. Effective utilisation of Gawadar Port and the promotion of regional trade connectivity, he added, could help mitigate the impact of the ongoing crisis.
Saleem Memon concluded that without timely and effective intervention, not only Hyderabad but industries across the country could face severe disruption, closures, and a new wave of unemployment, with far-reaching consequences for the national economy.
