Attachment: Download

/tmp/package-edit-bug (master)% xcodebuild -version
Xcode 11.5
Build version 11E608c
/tmp/package-edit-bug (master)% swift --version
Apple Swift version 5.2.4 (swiftlang-1103.0.32.9 clang-1103.0.32.53)
Target: x86_64-apple-darwin19.5.0

Issue Description:

See the attached Git repository to reproduce the issue. It includes the following three commits which represent a local package development workflow I've followed many times in the past with other dependency manages:

1. f9c8312 Initial commit: Add a dependency to the project, using a remote URL on GitHub. This project was created with the command swift package init --type executable.
2. 748272e Put SwiftIO into edit mode: Runs swift package edit and then git submodule add -f https://github.com/sharplet/SwiftIO.git Packages/SwiftIO to track the submodule in Git.
3. 8823882 Use local package path to break swiftpm: Take the package that's already in edit mode, and explicitly update Package.swift to point to the local package. The idea of this is to allow sharing of local package edits without having to run swift package edit each time. This breaks the package manager with the below error.

error: the Package.resolved file is most likely severely out-of-date and is preventing correct resolution; delete the resolved file and try again