In the past, Pakistan’s products were exported to Russia via transshipment. However, a new direct shipping service between Karachi and Saint Petersburg aims to make Pakistani products more competitive.
Starting this month, this service will provide trade access for Pakistani products in the Russian market. Abdullah Farrukh, Convener of Shipping Affairs at the Federation of Pakistan Chamber of Commerce and Industry, announced that the first ship will arrive at Karachi airport on May 25, 2023. Previously, exports through transshipment caused delays and increased transportation costs.
This service will facilitate the export of various items from Pakistan to Russia, including rice, fruits, vegetables, salt, sports goods, leather goods, and textiles. It is an important step to support Pakistani exporters. Farrukh also mentioned that Russian importers will pay Pakistani exporters in Chinese currency (Yuan), with the involvement of Chinese and Pakistani banks in these transactions.
According to the Pakistan Business Council, bilateral trade has always been favorable for Russia. In 2020, bilateral trade reached a high value of $757.6 million. Textile items accounted for 40.1% of Pakistan’s exports to Russia, while edible fruits made up 34%.
In 2020, Pakistan’s imports from Russia amounted to $617 million, including rubber, paper, pharmaceutical products, mineral fuels, edible vegetables, organic chemicals, cereals, iron, and steel. On the other hand, Pakistan’s exports to Russia in 2020 were valued at $145 million, consisting of cotton, knitted and non-knitted textiles, leather products, optical instruments, toys, cutlery, and man-made staple fibers.
The trade index indicates that instead of Russia supplying Pakistan, Pakistan is now required to supply Russia. Farrukh highlighted that through transshipment, it took over 50 days for Pakistani products to reach the Russian market. However, with the new direct shipping services, products will now reach their destination within 24 days.
He emphasized that the Russian market has a significant demand for Pakistani products, and this service will create healthy competition for Pakistani goods in the Russian market.
