LUDHIANA: The Russia-Ukraine war and sanctions against Russia by the western countries have also impacted the exporters from the region, as all major shipping lines have suspended cargo bookings for the aggressor country.
The container shipping ban on Russia means a big blow for the states of Punjab, Himachal Pradesh and Haryana, as a number of exporters and importers here do business with Russia and every year thousands of crores worth goods are exchanged.
During the last five years, the dry ports of Ludhiana, which are preferred by a large number of Punjab and Himachal based exporters/importers and a small percentage of traders from other states, have handled goods worth Rs 1,500 crores for Russia.
In the last 11 months alone, goods worth over Rs 241 crores (till February 2022) were exported from Ludhiana dry ports. Some of the major commodities exported from here this year included engineering goods, mainly nut bolts, hand tools, scaffolding goods and yarns among others.
During the last five years, goods of approximate value of Rs 500 crores have been imported into the region from Russia via Ludhiana dry ports. In 2021-22, goods worth Rs141 crores (till February 2022) were imported. Some of the major commodities imported this year via Ludhiana ports were iron scrap, other metals, isobutene rubber and butyl rubber among others.
Regarding the shipping ban, Ludhiana Customs House Agents Association president Rajesh Verma said, "All shipping lines have stopped bookings for Russia, even the containers in transit have stopped further movement. A major reason for this is economic ban and sanctions imposed by the European Union and other countries, due to which payment disputes are expected to arise between the parties involved. Moreover, no one wants to take the risk of movement in a war zone." According to Yogesh Sachdeva, another CHA (Customs House Agents): "There is a huge quantity of exports to Russia from Punjab, Haryana, Himachal Pradesh and Jammu & Kashmir. Approximately 100-200 TEU (20 Foot Equivalent) containers are shipped out of dry ports around Ludhiana alone, for Russia and neighbouring countries, every month. There are other ports also in the country, like Mundra, Nhava Sheva or dry ports, which are preferred by exporters, which means the figure of exports-imports from the region is manifold. As for the suspension of cargo to and from Russia, no doubt it will hit the exporters and importers very hard, but CHAs and other stakeholders like insurance agents and transporters will also suffer big losses."
According to Rahul Ahuja, ex-chairman of CII Punjab, the ban on booking of export shipments for Russia is a big blow for exporters doing business with that country. "There is a significant number of businessmen not only from Ludhiana but even from other cities of Punjab and neighbouring states, who export engineering components, textiles, garments, food products etc to Russia, and this ban will impact all of them. Moreover, the suspension of cargo has also put those businessmen at high risk who shipped their export orders recently but are still to recover payments from their buyers in Russia, as the shipments in transit to Russia too have been held midway by shipping companies."
Expressing similar concern, Importer and Exporter Club Punjab president Rohit Gupta said, "It seems the ban will go on for a long time. In another big cause of concern, there is no clarity whether essential commodities like medicines will be allowed to go through. If shipping companies do not clear the air on accepting delivery of essential commodities, there will be an even more disastrous situation in the region, because besides engineering, textiles and agriculture goods exporters from Punjab and Himachal, there are very prominent traders and manufacturers who export pharma products to Russia. All of them will be severely impacted as well."
