Global logistics company DHL suspends some operations in Pakistan

Islamabad : Dalsey, Hillblom and Lynn (DHL), a global logistics company on Monday announced the suspension of some of its operations partially in Pakistan due to the government's restrictions on outbound remittances, Pakistan-based Dawn newspaper reported.

According to Dawn, DHL Pakistan has informed its customers that it is suspending 'Import Express Product' and restricting outbound shipments to a maximum weight of 70 kg per shipment for all customers billed in Pakistan from March 15. As per the company, the last pick-up date would be March 14 and shipments picked up on or before this date would still be delivered.

The Pakistan Muslim League (N) (PMLN) led coalition government and the State Bank of Pakistan, amid the fast dwindling foreign exchange, imposed restrictions on outward remittances for foreign companies operating in Pakistan.

"The remittances sent by DHL Pakistan cover the cost of DHL's international aviation, hub, gateway and last-mile delivery incurred through our global network for the shipments sent/received by valued customers," the courier service provider said, adding that this constraint has made it unsuitable for DHL Express to continue providing the full product offering in Pakistan.

The company said it is in regular contact with the Pakistani authorities to allow pending remittances to resume the full suite of services in the country at the earliest, according to Dawn.

Islam Khabar recently reported that Pakistan could have made an economic recovery through foreign investments. The country, however, is not known to have an investment-friendly regime.

Foreign investors avoid bringing money into Pakistan due to various factors such as political instability, discontinuity of macroeconomic policy, terrorism, corruption and energy shortages.

In the past two decades, Pakistan has tried implementing several FDI-friendly measures. Wide-ranging structural reforms were attempted by the country to attract multinationals which could become the enablers of economic growth and job creation in the country.

However, effective implementation of such measures remained slow due to ground-level problems in the country including red-tapism, bureaucratic lethargy, rampant corruption, misguided ideology and extremism, Islam Khabar reported.

Corporations from many developed countries have thus struggled to grow their investments in Pakistan.

Companies such as Proctor and Gamble, Oracle services Pakistan, IBM Pakistan, FedEx (Gerry's Group of Companies), Marriot Hotels, and Troy Group Inc. have to approach the State Bank of Pakistan (SBP) and other departments for minor problems which leads to disruptions in their operation.

Proctor and Gamble's plans for importing raw materials and machinery into Pakistan are in limbo due to SBP's restrictions on the import of machinery.