A strike by goods transporters in Pakistan is jeopardising letter of credit (L/C) transactions and spiking prices according to business leaders there.

The industrial action may have an even more destabilising impact as imports ramp up ahead of Ramadan.

L/C concerns

Supplies of goods and commodities are slowing down across the country while the stock of containers is growing at Pakistan's ports.

According to the chairman of the Pakistan Apparel Forum, this will have a devastating effect on some clothing importers.

Many exporters' L/Cs are about to expire says Javed Bilwani. "They will go bankrupt," he said. He stressed that very many businesses are "suffering terribly" because of the strike.

Price pressure

Concerns are growing about a possible retail price hike, with the strike inflating transport costs just when increased demand for goods of all kinds during Ramadan also inflates prices.

There are also concerns that goods stranded at Pakistan's ports may perish. "Almost 13,000 containers - most of which carry food items - are now held up at Karachi Port's terminals," according to the chairman of the Pakistan Soap Manufacturers Association, Abdullah Zaki.

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.