Panipat, one of Haryana’s major textile and exports hubs, has witnessed a slump in overseas shipments due to elevated freight charges and lack of ships. Soaring global fuel prices along with geopolitical tensions have badly impacted the transportation of goods from this northern Indian city.
Panipat is well known worldwide for its vibrant textile industry that employs hundreds of thousands of workers. A wide array of products like garments, bed linen, floor coverings and more find buyers abroad. However, the current scenario in the shipping sector has placed local exporters in a tough spot. Freight rates have ballooned to $5,200 per container from European ports, rising over five-fold since last year. Vessel shortages mean thousands of containers are stuck at ports awaiting shipment.
The months from May to August are Prized by exporters as major festive orders arrive from markets in Europe and America. But inflated transportation costs have made even small orders financially unviable. Further, delays in deliveries could cause buyers to cancel Christmas period contracts, resulting in heavy losses. Industry leaders point out that Panipat’s $15 billion export trade may decline over 50% this year due to these dual challenges.
While soaring fuel costs impact shipping worldwide, some experts say bookings by major client China are accounting for limited ship availability. As western nations move production away from China in an ongoing trade war, vessels have prioritized Chinese exports. This is exacerbating the container pile-up at all ports catering to Asian trade routes.
Unless shipping lines increase capacity by adding vessels and charters, uncertainties will persist for Panipat’s export-reliant textile sector. Any resolution to global energy price inflation and geopolitical conflicts could provide much needed stability. But for now, high freight rates and scarce logistics continue hassling this important industrial region’s overseas shipments.
