KARACHI: Tea could become a “rare commodity” in Pakistan by next month if authorities failed to release around 300 containers of the product stuck at the Karachi port, an official at the Pakistan Tea Association warned on Monday.
Pakistan is the largest international tea importer in the world, spending over $600 million on the product each year. According to the Pakistan Tea Association (PTA) which represents importers, Pakistan annually imports 250 million kilograms of tea.
But Pakistan’s $350-billion economy is currently facing a balance-of-payments crisis, with foreign exchange reserves dipping to less than three weeks of import cover. This has forced the government to restrict imports, including of industrial raw materials, while commercial banks have stopped issuing letters of credit (LCs), leaving importers struggling to arrange the greenback for already placed orders.
“Around 300 [tea] containers are stuck at the Karachi port and if they are not released immediately, tea will become a rare commodity by next month,” PTA top official Aman Paracha told Arab News, saying Pakistanis, whose day started with a cup of tea, would not be able to survive without the beverage.
Paracha said the containers had been stuck for about a month, while PTIA had been advised by the central bank to submit a request for their release on a deferred payment basis.
“We wrote to the state bank but then a restriction was made that only Bill of Lading of up until January 18 will be considered,” he said, referring to a document issued by a carrier to acknowledge receipt of cargo for shipment.
“While this issue of pending containers will create a tea crisis, it is also causing huge losses to the importers who have to pay $120 as detention charge per day,” Paracha said.
Central bank spokesperson Abid Qamar said he was unaware of the PTA request but added that officials of the central bank had asked the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) to communicate the details of each association’s stuck containers to the State Bank of Pakistan so a plan of action could be devised.
“The bank cannot speak to every association separately, this is why we asked the federation to communicate to us the details of stuck containers,” Qamar said. “We assured them that these issues are resolved on a priority basis.”