KPT Chairman Announces Increase in Demurrage-Free Period to 8–10 Days for Iron and Steel Imports

KARACHI: Karachi Port Trust (KPT) Chairman has announced major relief for iron and steel importers, agreeing to extend the demurrage-free period from the existing five days to between eight and 10 days for cargo affected by delays at Karachi Port.

The announcement came during a meeting with a delegation of the All Iron and Steel Merchants Association, led by its President Hamad Poonawala, amid a serious operational crisis and prolonged delays in handling general cargo, particularly iron and steel imports at the Karachi Gateway Terminal Limited (KGTL).

The meeting was attended by KPT planning directors, senior Customs officials, including the Chief Collector of Customs, Collector of Customs and deputy collectors, as well as KGTL’s chief executive officer, operations managers and commercial managers.

Representatives of the association, including the vice chairman of its Marine Committee and heads of transport and customs-clearing companies, also participated. The vice chairman of the All Pakistan Pipe Mills Association played a role in coordination and joint consultations, while the senior vice president of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) joined the meeting through Zoom.

Ships Waiting at Sea for More Than a Month

Participants expressed serious concern that several general cargo vessels had been anchored at sea for more than a month because of the unavailability of berths and operational difficulties at KGTL. A significant portion of the cargo comprises raw materials and industrial supplies, particularly iron and steel.

The prolonged delays have severely affected domestic industries, disrupting raw material supplies to several industrial units and bringing some production activities close to a halt. Importers are also facing losses worth millions of rupees, along with additional shipping and other expenses.

The meeting was informed that uncertainty over berthing arrangements and extended vessel waiting times had prompted international shipping companies to increase freight rates for Pakistan by approximately $20 to $30 per tonne. Some shipping companies were also reportedly refusing to provide shipments to Pakistan.

The participants warned that the situation was increasing import costs and damaging the country’s industrial supply chain and business reputation.

The association also raised concerns over KGTL’s existing operational management, berthing procedures and delays in cargo handling. It particularly objected to the berthing of certain vessels outside the designated vessel queue, saying this had further aggravated difficulties for general cargo ships already waiting for their turn.

KPT Chairman Announces Six Measures

The KPT chairman said vessels carrying essential commodities such as wheat, fertiliser and soybean had been given priority berthing because of the country’s urgent requirements, placing extraordinary pressure on port operations. He expressed hope that the emergency situation would normalise soon.

In response to the association’s demands and the substantial financial losses suffered by importers, the chairman announced several measures and assurances:

1. Extension of demurrage-free time: The existing five-day period will be extended to eight to 10 days for iron and steel cargo affected by the delays, providing relief to importers from additional financial burdens.

2. Conditional permission for motorcycles: Workers will be allowed to use motorcycles inside the port for the next 60 days, subject to conditions, to address movement difficulties and improve operational efficiency.

3. Strict adherence to vessel queue: The chairman assured the delegation that vessels would not be given berthing outside the designated queue on a preferential basis. General cargo ships would be accommodated according to the First-Come, First-Served principle.

4. Priority for general cargo vessels: General cargo ships, particularly those carrying iron and steel, would be berthed according to the prescribed queue, with efforts to speed up unloading.

5. Improvement in port operations: KPT, in coordination with KGTL management, would work to improve cargo handling, loading, unloading and overall port management and remove existing operational bottlenecks.

6. Settlement of pending refunds: The chairman assured the importers that he would personally intervene and contact the relevant management to facilitate the payment of long-pending refunds to importers through KGTL.

Follow-up Meeting in 15 to 20 Days

It was also decided that a follow-up meeting would be held within the next 15 to 20 days to review implementation of the announcements and assurances made during the meeting and take further measures to resolve outstanding issues.

At the conclusion of the meeting, Hamad Poonawala thanked the KPT chairman, Customs officials, KGTL management and other participants.

He said the association’s primary objective was not to confront any institution but to find practical and sustainable solutions to the challenges facing Pakistan’s industry, trade and economy.

Poonawala reaffirmed that the association would continue its efforts to protect the legitimate rights of importers and the industrial sector and remain in contact with the relevant institutions to ensure that the progress made during the meeting translated into practical results.

The association expressed hope that the assurances would not remain mere announcements and that their prompt and effective implementation would help end the crisis at Karachi Port, restore industrial activity and prevent further losses to the national economy.