Ismat Sabir
At last the first ship carrying 60,000 tonnes of wheat docked, unloaded and safely sailed out from the Gwadar Port. The local company chartered a Panamax class vessel for importing wheat from Canada. The port authorities have faced a few difficulties during unloading, but it is hoped that the next ship will be handled with more care and safety, as per international standards. MV Hyderabad had been engaged for lighterage and around 9,000 tonnes of wheat was unloaded before the Post Glory was allowed to berth at Gwadar Port.
Thus, Gwadar Port finally made history by beginning its cargo handling from March 15, 2008. It was also an important event in the sense that it was the biggest ship that had ever docked at a Pakistani port. The arrival of the ship has boosted business and trade activities at all levels. It was marvellous to see that hotels and motels were full of visitors. There were even rumours that there was a shortage of flour in certain hotels. Dozens of truck drivers were sleeping on their trucks, waiting for loading wheat to be taken to up country.
Gwadar Port has depth of 14.5 metres and approach channel of five kilometres. Three multi-purpose berths of 210 metres in width have been built. The port can handle bulk carriers of up to 50,000 DWT through its three berths. The port is ready to handle fertilizer and rice shipments for export, as proper bagging infrastructure is available at the proximity of the port. It is going to emerge as world’s next biggest skyline. In view of its bright future, Gwadar has attracted the business community not only from Pakistan but also abroad.
Gwadar seaport development programme was approved and it was decided to commence negotiations with Chinese counterparts to the Gwadar seaport development to attract investment in this area. It was already decided that financial incentives equal or better than Chinese SEZs would be provided to the investors in the area.
The government has already declared Gwadar Port as petrochemical and POL storage field for what it has sought $ 12.5 billion investment from China. The port project aims to have facilities that could help to develop Gwadar as an industrial city that has privately owned warehouses and cold storage, private cargo handling equipment, truck yards and corporate infrastructure such as offices along the same lines as Jebel Ali, Hong Kong, Malaysia and Singapore.
Under an agreement the Port of Singapore Authority International (PSAI) is responsible for operations of the Gwadar Port. PSAI has asked the government of Pakistan to allow tax holiday for 25 years, exemption of the lenders from income tax on interest and stamp duties in respect of financing agreement and exemption of the operating companies from sales tax.
Gwadar has potential to be more beneficial port than Karachi or Port Qasim, because of its geographical and strategic location at the mouth of Strait of Hormuz, and as a deep water open sea port. This advantage is not available by Dubai, Khark Island or Kish, in the Gulf. However, there may be competition with Chahbahar Port in Iran, but political and economic constraints of Iran made Gwadar more advantageous. Gwadar may be a gateway to the landlocked states in Central Asia, Gulf, Afghanistan and China.
The emerging new oil and gas centres around the Caspian seek outlets for their products and Gwadar offers a two-way outlet to markets east and west, north and south, unhampered by the conflicts in the region.
Dubai has advantages of free port that can be overcome by declaring Gwadar also a free port at least for 10 years to attract local and foreign investment. In order to attract major shipping lines of the world, port tariffs should be made attractive for the initial period of two years. Although Dubai is far more developed as it is a real cosmopolitan city and international trade centre, but Gwadar is a much cheaper and a better place for cost of doing business. Moreover, the backing it receives from China and the advantage of direct access to and from Central Asian States and through them by overland routes to Russia and Europe on the one hand and Korea and Japan on the other, which provides Pakistan a unique opportunity to cash in on its fortunate location. In years to come, particularly when Balochistan would be fully developed and its natural resources exploited to the optimum, the good chances are not too distant to be reaped.
Gwadar lies on main shipping lanes. While ports of the Gulf are located on western side of Gwadar. Sri Lanka and Indian ports are on its eastern side. Gwadar is strategically located outside the sensitive area of Strait of Hurmuz, a major conduit for global oil supplies in the region. Gwadar can be developed into a multipurpose and mother port of the region which can accommodate motherships of Post Panamax category and need a draft of 18 metres and above. The dredging was carried out to deepen the approach channel to 14.5 metres and third dredger was also inducted to expedite the process. The deepening of approach channel was to be carried out under phase-II but it was also included in phase-I to keep the status of the Gwadar Port.
The federal government has planned that the existing fish harbour at Gwadar would be used as mini-port for cargo handling purpose annexed with the Gwadar deep seaport and to replace the existing fish harbour. The government aims to construct a fish landing jetty and allied harbour facilities at Pishukan, Gwadar. The project will cost Rs 629 million and the provincial and the federal governments will share the cost on a 20:80 basis. At present, there is no fish landing jetty or allied structures in these villages for necessary all-weather fish catching.
The project will be implemented in two phases. Phase-I comprises fish jetty, road works, auction hall, break water and groined wall to be completed within two years. Whereas, the second phase will be completed in 36 months through private sector under BOT (build operate transfer) and BOO (build-operate-own) basis consisting of construction of additional jetty, break water, reclamation works, for fishing facility, repair yard, cold storage, ice plant and packing and processing plant.
After construction of the fish-landing jetty, the fish catch at Pishukan will increases from 9,310 metric tonnes in 2007 to 12,040 metric tonnes by 2015. The Pishukan share in fish catch will increase to 15,560 metric tonnes per year by 2020 and will touch the figure of 20,310 metric tonnes by 2025.
Site for China-Saudi oil refinery in the proposed Oil City at Gwadar is being identified by the government of Balochistan. Incentives for setting-up of Special Economic Zones (SEZs), Gwadar seaport development programme for expansion of bilateral trade and strengthening of investment relations are also under way. However, the development of Gwadar Port depends on adequate and modern infrastructure in this hinterland. The authorities should give immediate attention to this aspect. The big constraint is financing the project of infrastructures, but the future revenue generation potential of the new port will soon recoup the initial investment.
The port will provide employment opportunities and social uplift which will solve the age old problems faced by Balochistan. It will fillip the industries, mining, agriculture, horticulture, animal husbandry, trade and commerce in Balochistan. The cumulative effects of all the above and other factors would be innumerable and unimaginable for Pakistan. The public and private sector must speed up their developmental work so as to accommodate the human influx and other related issues. Government should provide some concessions on custom duties, etc to importers and exporters in order to operationalise the Gwadar Port. The concessional flat rate being offered by Dubai port should be followed and it should be made model to study for its efficacy.
The Ministry of petroleum should make special provisions for the supply of bunker fuel at duty-free price or special incentives should be given to private investors. The East Coast Expressway should be built on priority basis so that transportation to and from the harbour should not be hindered, since the present route passes through the town and is likely to bring chaos, as the port has become operational. Construction of Gwadar-Ratodero and Gwadar-Khuzdar roads needs to be expedited to make the route shorter from Gwadar, which will reduce cost of transportation and time saving.
The writer is a senior journalist and researcher
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