Gwadar - A Jewel in the Crown

[Neo]

Gwadar to get Rs 1.722 billion in PSDP 2008-09​

By Ijaz Kakakhel

ISLAMABAD: Keeping in view the strategic importance of Gwadar Port, the federal government has allocated Rs 1.722 billion for its development in the next fiscal year 2008-09.

In this regard allocations for six ongoing and one new development project has been approved in National Economic Council (NEC) meeting presided by Prime Minister of Pakistan. Total cost of these seven projects relating to development of Gwadar Port is Rs 27.681 billion.

The single new project for Gwadar development is ‘construction, supply and installation of two Pontoons (low-level platforms) at Gwadar Fish Harbour-Mini Port’ worth Rs 33.400 million.

The on-going six projects are: ‘Gwadar Deep Water Port (Phase-I) including deepening of channel worth Rs 16.380 billion’, Gwadar Port Civic Center, Gwadar worth Rs 199.730 million’, ‘Eastbay expressway to link National Road Network, Gwadar with cost of Rs 3.767 billion, ‘Construction of fish landing jetty and allied harbor facilities at Surbandar- East Bay – Gwadar worth Rs 672.674 million’, ‘Construction of fish landing Jetty and allied Harbor Facilities at Pakistan – West Bay Gwadar at Pushukan worth Rs 628.500 million’ and ‘Gwadar - Turbat - Hoshab Section (200 km) of Gwadar – Ratoder Road (650 km) M-9 worth Rs 6 billion’. The government expect that the last project namely, ‘Gwadar - Turbat - Hoshab Section (200 km) of Gwadar – Ratoder Road (650 km) M-9’ will cost Rs 8.533 billion till June 30 2008 and it surpass the actual amount Rs 6 billion total cost of the project. For next fiscal year, the government has allocated Rs 1 billion in the PSDP 2008-09.

The government is expecting that Rs 26.118 billion will be spent on the the six ongoing projects till 20 June.

The government has allocated Rs 200 million in the PSDP 2008-09 for Gwadar Deep Sea Water Port (Phase-I), Rs 38.730 million has been allocated for Gwadar Port Civic Center, Gwadar, Rs 100 million to be provided for East Bay Expressway to Link National Raod Network, Gwadar, Rs 175 million allocated for Construction of Fish Landing Jetty and Allied Harbor Facilities at Surbandar East Bay Gwadar, Rs 175 million has been allocated for Construction of Fish Landing Jetty and Allied Harbor Facilities at Pakistan West Bay Gwadar at Pushukan and Rs 1 billion for Gwadar-Turbat-Hoshab Section (200 km) of Gwadar – Ratoder Road (650 km) M-9.

The Gwadar port project arose from a Sino-Pak agreement signed in March 2002 under which China Harbor Construction Corporation is building the port. Beijing has provided $198 million and Islamabad $50 million.

Gwadar is also visualized as becoming a regional hub, serving commercial traffic to and from the Mid East, the Persian Gulf, and China’s Xinjiang province, Iran, Sri Lanka and Bangladesh. Its location at the mouth of the Persian Gulf and at the opposite end of the strategic choke points of Straits of Hormuz and the Gulf of Oman enhances its strategic importance. Its development could as well favourably influence the geo-strategic environment of the region and have an overall beneficial impact on Pakistan.

Additionally, the port would facilitate efficient exploitation of Pakistan’s exclusive economic zone, which so far has remained largely unexplored. The area is known to be rich in fisheries and if the 600 kilometer long coastal line is fully exploited, it could give a substantial boost to fish and crab exports and promote food-processing industries. Gwadar, lying close to the oil rich Gulf-states, could be a potential source of off–shore gas and oil reserves.

Daily Times - Leading News Resource of Pakistan

 

[Neo]

Cabinet proposes a revisit of Gwadar Port contract ​

ISLAMABAD (June 26 2008): The federal cabinet has proposed a revisit of the contract signed between a consortium of Singapore Port Authority (SPA)/AKD Securities and Shaukat Aziz-led government on Gwadar Port, well-placed sources told Business Recorder.

The cabinet had considered 'Gwadar Port Authority's revised bill for carving a new corporate structure of the port' in its meeting on June 4 but did not clear the bill due to several reservations. "The GPA affairs as well as the contract signed with the foreign operator called for a thorough review in consultation with the Balochistan government," sources quoted Prime Minister Syed Yousuf Raza Gilani as saying.

The cabinet was informed that the previous cabinet, on 27 June, 2007, had approved the draft bill for the establishment of GPA, subject to certain conditions including provisions relating to appointment of chairman and members of the board and their term of office, etc.

The Master Plan and business strategy of Gwadar Port envisaged that the chairman and members of the board shall be non-executive. The responsibility for management of all affairs of the authority would rest with the Chief Executive Officer who would act as the co-opted board member and would report to the non-executive chairman and the board on all matters including those delegated by him to his subordinate officers.

The Ministry of Law and Justice has vetted the draft bill titled 'Gwadar Port Authority Act, 2008' prepared by the Ministry of Ports and Shipping. However, the cabinet observed that the draft bill is flawed and contains self-contradictory provisions. Moreover, the proposed corporate structure was not in line with best international practices.

The cabinet after detailed discussion over the controversial draft bill has decided that it should be first examined by a committee comprising Ministers of Port and Shipping, Finance, Law and the Deputy Chairman of Planning Commission. It has also been decided that one Minister from Balochistan should also be co-opted.

It is not yet clear whether the committee has submitted its report to the Prime Minister for consideration. According to sources, phase-II of the project will be implemented on BOO (Build-Own-Operate) or BOT (Built-Own-Transfer) basis. Phase-II envisages construction of 10 more berths eastward of 4,200m long coast in phases under private sector as and when the utilisation on the existing berths under Phase-I reaches maximisation (ie 70 percent).

The port would be provided road and rail link with the national network. Port of Singapore Authority International (PSAI) has been assigned the job of port development under Phase-II in the concession agreement for 40 years. Gwadar Port is expected to contribute $42.2 billion, in terms of investment, revenues and income received from its entire operations to the exchequer, over a period of 40 years.

Business Recorder [Pakistan's First Financial Daily]

 

[Neo]

Gwadar Port: Stop running in circles ​

EDITORIAL (June 27 2008): The Federal Cabinet has deferred approval of Gwadar Port Authority Bill 2008, on the ground the draft was "flawed and contained self-contradictory provisions". It has proposed a review of the contract signed by GPA with the port operator. It has become a norm in Pakistan to be critical of the predecessor's decisions and policies instead of building upon his good work.

In the present case, it is also an attempt to seek political mileage and pacify the angry Baloch nationalists who did not have a say in awarding contracts in the province. The Planning Commission, the provincial government of Balochistan and the Gwadar district Nazim were fully involved from the stage of conception to construction of berths by Chinese contractors and subsequent award of contract to a world class port operator.

Even the Master Plan for the city of Gwadar as well as the terms of the contract with regard to it and tax holiday period were approved at the Federal Cabinet level with the participation of the former Chief Minister Jam Yousuf. Back in 1996, the then Prime Minister Benazir Bhutto approved the construction of a deep-water port project at Gwadar on BOT terms of 50 years.

OTHER APPROVED TERMS INCLUDED: (A) 18,000 hectares of land to be provided by the Government of Balochistan "free of cost"; (B) Wapda to provide electricity; (C) NHA to construct 895 kilometres Gwadar-Rato Dero Road and Gwadar-Karachi Coastal Highway; (D) Free of cost (except development charges) land to be provided for establishing industrial ventures and warehouses and; (E) Offer of concessions comparable with those available to existing free zones in Far East to world class companies.

After the imposition of Martial Law in 1999, the project was, however, cancelled. While celebrating 50 years of Pak-China Friendship in 2002, China agreed to construct the port with $250 million loan on generous terms Phase-I of the project being construction of 600 meters of berths.

In 2006, tender was floated for operation of Gwadar Port, marine services and Free Zone on BOT for 40 years. After due competitive process, GPA signed an agreement with Port Singapore Authority. As per terms, PSA delegated the task to three joint venture companies.

One was to operate the port, the other to provide pilot and bunkering services and the third company to develop the free zone. Two locals, namely: AKD and NLC partnered PSA in these companies.

The slow progress to get Gwadar fully functional has nothing to do with the agreements between GPA and PSA. Further, no port can function without a commercial hinterland attached to it with requisite infrastructure for domestic and transit cargo. Land bank is a must for Gwadar.

KPT has 4,000 acres; Port Qasim has 10,000 acres and Gwadar needs 30,000 hectares. And, just like any other port Gwadar needs road and rail connectivity.

Instead of witch-hunting, the new ministerial committee should look into the real causes of slow progress at Gwadar. The Federal Cabinet needs to come up with adequate funding for providing the hinterland to the port. It also needs to be ascertained who violated the Prime Minister's 1996 directive to Balochistan government to provide land free of cost.

And, why was the 2001 directive of the Prime Minister to freeze allotment of all land in Gwadar city area and transfer of all government land to the port not undertaken? The legal status of these Prime Ministerial directives need to be ascertained. The Shaukat Aziz Cabinet after due approval from President Musharraf had ordered the Pakistan Navy to shift to a new location and have the earmarked contiguous area of the port transferred to GPA.

The sale of land in Gwadar to outsiders has created a siege mentality in the Mekran Coastal belt. Locals feel that the outsiders would reduce them to a minority. This line of thinking is not unique among the nationalists. There are states where outsiders cannot own property in a province and also do not have a right of vote. For the sake of strengthening the Federation, these Baloch sensitivities should be addressed.

To make Gwadar port functional, Pakistan Navy and Coast Guard lands should be handed to the operator. The Port Master Plan should be strictly adhered to. And, completion of Gwadar-Rato Dero Road by 2010 must be ensured.

For the first few years the government will have to provide inducement for import of bulk cargo at Gwadar, and, live up to its commitments, as per signed agreement, with PSA. Let us not kill the goose; we cannot get the golden eggs if we do so.

Business Recorder [Pakistan's First Financial Daily]

 

[bhangra12345]

What is the nearest "big" industrial areas for gwadar?
How are they connected to gwadar?
How far are they from Karachi?

If Karachi is nearer to most of them, gwadar will need investments in developing the industrial hinterland first, more than the port itself.

 

[smt]

thers been all this hype of gwadar being a big asset to pakistan, and making it into a dubai type of place, and a big port. so has anything started hapening til now? has there been any international interest in it or are there even any ships passing through it nowadays?

 

[Neo]

Japanese investment in Gwadar sought ​

Thursday, July 10, 2008

ISLAMABAD: Pakistan on Wednesday sought Japanese investment by presenting Gwadar port as an ideal location, where it can explore possibilities of investment in fields like petrochemicals, heavy engineering, food processing, metal works, steel products and other export-oriented industries.

Mian Manzoor Ahmad Wattoo, Adviser to the Prime Minister/Minister for Industries, Production and Special Initiatives in a meeting with the Ambassador of Japan Seiji Kojima, who called on him here, stated Pakistan was strategically located as a regional hub with abundant land and natural resources, strong human resources and large and growing domestic market, which offer tremendous investment opportunities to countries like Japan, says a news statement issued here.

Wattoo further said that Japan is one of the leading donor countries giving economic aid to Pakistan and it has played an important role in Pakistan’s development through economic and technical assistance, thereby promoting strong economic and political relations between the two countries. “We want Japan to bring more investment in Pakistan,” he said.

Export Processing Zone Authority (EPZA) of Pakistan offers attractive incentives/facilities for investment in EPZs. Investment from Japanese investors is welcome where they can set up their own exclusive country zone in Pakistan.

Wattoo also emphasised that as Pakistan’s economy is developing, we need more market access in Japan in the areas where Pakistan has the potential to collaborate in terms of technology tie-ups, co-manufacturing, co-financing and co-export.

The ambassador noted that Japan was already cooperating with SMEDA (Small and Medium Enterprises Development Authority), a subsidiary of the Ministry of Industries and Production on various SME projects.

He further said that Japan is concentrating on the development of infrastructure in Pakistan. The ambassador also informed that a Japanese company, YKK, is setting up two plastic mould centers, one in Karachi and one in Lahore.

Japanese investment in Gwadar sought

 

[Proud to be Pakistani]

Nice to hear!

 

[Neo]

Gwadar Port to get operational with wheat arrival ​

Friday, August 22, 2008

ISLAMABAD: The government’s decision to receive imported wheat at the Gwadar Port is aimed at making the port operational and introducing it on international shipping and trade forums.

This will reduce dependency on existing two major ports, Port Qasim and Karachi Port, where larger vessels cannot be handled, and will also provide an alternative source for docking, an official requesting not to be named told The News on Thursday.

“Tremendous economic activities will be generated when the vessel carrying 50,000-60,000 tonnes of cargo dock at the port and then about more than 2,000 trucks will be used to transport the imported commodity to upcountry,” said the same official, adding that it would also reduce cost and freight charges of handling the imported commodity.

Offloading of ships carrying imported grain on Gwadar Port would spur the local business and trade including that of hotels and restaurants. Moreover, the local labour would get employment and if the trend continues, the shipping activities at Gwadar Port would help in defeating poverty and other miseries of the Baloch people, they hoped.

To this effect, the government will allow one third of the imported wheat to be offloaded at Gwadar Port for curtailing the cost of importing the commodity, sources in the MINFAL confirmed to The News about berthing of ships at Gwadar port.

The Economic Coordination Committee (ECC) of the cabinet in its meeting on next Tuesday (August 26) will deliberate on the issue as Balochistan Chief Minister, Nawab Aslam Raisani in a meeting with MINFAL requested it to offload some of ships carrying the imported grain at Gwadar Port for the betterment of the people of the province.

The chief minister further asked the MINFAL that it should issue separate wheat import tenders particularly mentioning Gwadar Port as the port of destination, this would generate revenue for alleviating the miseries and economic woes of the people of the province.

The ECC of the cabinet in its last meeting directed MINFAL to have reasonable quantity of the imported wheat shipped to Gwadar Port but the Trading Corporation of Pakistan (TCP) has so far accepted bids destined either for Port Qasim or Karachi Port.

In last year’s wheat imports of 1.73 million tonnes, only one ship with 75,000 tonnes of commodity docked at Gwadar Port, but it was not properly handled and the cost of imported wheat increased manifold.

“We are recommending the ECC to allow one third of the total imported wheat to be offloaded at Gwadar port as it would help the importing agencies to cut cost and freight,” said an official of the MINFAL.

The TCP has so far booked 1.601 million tonnes of red wheat and four ships carrying 160,000 tonnes of wheat have unloaded the imported quantity either at Port Qasim or Karachi Port and the rest of the shipments too are booked for both ports but not for Gwadar Port.

The TCP last year booked imported grain in haste and all the ships carrying imported wheat reached the ports one after the other resulting in non availability of berths at ports to unload the commodity. This caused ships to wait beyond their scheduled time resulting in demurrage claims that TCP paid from the national exchequer, sources in the shipping ministry told this correspondent.

To avoid last year’s crowding at the port, the MINFAL is also recommending the ECC to divert one third of the ships carrying imported grain to be docked at Gwadar port, MINFAL official said.

As the port located in wheat deficit area, so the imported grain could also be awarded to the province to meet its domestic requirement while the remaining would be transported through rail to the rest of the country, he added.

 

[Neo]

Gwadar lacks infrastructure, other facilities ​

Sunday, August 24, 2008

KARACHI: Standing Committee on R&D of the Federation of Pakistan Chambers of Commerce and Industry has shown serious concern over the underdevelopment of Gwadar port as according to a fact-finding report prepared by it, Gwadar port lacks the required infrastructural facilities to make it functional and do any significant operations.

The report read that a nearly 750km coastal road from Karachi to Jiwani near the Iranian border has been in operation for sometime, while a 200km branch road that would link the coastal road to the Indus Highway at Ratto Dero is still not developed.

It further pointed out that there are no internal roads and services like water, gas, power and communications for the new township and the industrial area is non-existent.

There are no warehouses or cold storages in the area and no significant progress has been made so far in respect of the development of commercial and residential areas and buildings, while there are also no labour-related amenities for accommodating thousands of workers to be employed on a functional seaport.

Furthermore, the master plan prepared for the development of Gwadar, which was a fishermen’s village, had been approved in 2004.

The western portion had been reserved for development of residential areas while the eastern portion was for industries and warehouses.

However all these expected benefits have remained only in files because there is nothing on the ground so far in and around Gwadar to facilitate such activities, the report further mentioned.

 

[Neo]

FPCCI concerned over slow development of Gwadar port area​

ISLAMABAD (August 24 2008): Federation of Pakistan Chambers of Commerce and Industry (FPCCI) President Tanvir A. Sheikh and the FPCCI Standing Committee on Research and Development on Saturday expressed concern on the under-development of Gwadar Port area.

According to the fact-finding report prepared by 6the FPCCI Standing Committee on R&D Gwadar Port said that there almost in tranquil glory lacking the required infrastructural facilities to make it functional and sans any significant operations.

Nearly 750-km-long coastal road from Karachi to Jiwani near the Iranian border has been in operation for some time. A 200-km branch road that would link the coastal road to the Indus Highway at Ratto-Dero is still not developed.

Tanvir A. Sheikh pointed out that there are no internal roads and services and water, gas, power and communication services for the new township and the industrial zones are non-existent. There are no warehouses or cold storages in the area. No significant progress has been made so far in respect to development of commercial and residential areas and buildings, and there are no labour-related amenities for accommodating thousands of workers to be employed on a functional sea port.

The Gwadar Port project was given to Singapore-based company with the hope that this company will develop the port and will bring the foreign investment for Gwadar. Tavir Sheikh said that Gwadar Port was still not contributing its due share in the economic development of the Pakistan. He demanded that a committee should be constituted with the representation of all stakeholders and the FPCCI.

The representation of the industry is indispensable because the industry will provide employment for the local population and generate revenue for the development activities in Gwadar. The Gwadar Port, the third port of Pakistan borders on Arabian Sea would be deeper than all other ports in the Persian Gulf, Arabian Sea, Indian Sea, Bay of Bengal, and Gulf region and huge cargo ships up to 0.25 million tons could anchor here.

The master plan prepared for the development of Gwadar, which was a fishermen's village had been approved in March 2004. The western portion, which is away from the port, has been reserved for development of residential areas while the eastern portion for establishment of industries and warehouses.

Several projects had been planned for provision of infrastructure, which includes 950-km railway and 900-km motorway to link with the railway and highway systems of the country. But all these expected benefits have so far eluded the locals because developmental works are still to take off.

 

[UnitedPak]

Uzbekistan wants access to Pakistan's Karachi and Gwadar port

Uzbek Ambassador Oybek Arif Umanov has said Uzbekistan will consider entering into a tri-partite agreement with Pakistan and Afghanistan in order to gain access to Pakistani ports at Karachi and Gwadar.

In a special interview ahead of the 17th anniversary of Uzbekistan Independence on September 1, Umanov said Pakistan and Uzbekistan had great potential to increase bilateral economic, political, cultural and diplomatic ties. He said, “Trilateral agreement will help increase volume of bilateral trade.”

He said the two countries had already signed more than 29 agreements and MOUs. He was optimistic for enhancement in joint ventures and FDI. He said an agreement on transit trade, signed by former prime minister Shaukat Aziz in Tashkent, had opened broad perspectives for exchange of trade.

The ambassador said first Pakistani truck of Pak Caspian Trade Links Company reached Uzbekistan on 17 April 2008 and opened up a corridor for transit cargo to Kazakhstan and Kyrgyzstan through Uzbekistan and Afghanistan. The truck carried Pakistani products through Afghanistan to Uzbekistan and Kazakhstan and brought back goods and chemicals from Uzbekistan.

He said Pakistan and Uzbekistan agreed to establish joint ventures in textile, pharmaceutical and leather industries and exchanging technology to be used in healthcare sector on March 8 last year during the third session of Pak-Uzbekistan Joint Ministerial Commission (JMC).

He said Pakistan and Uzbekistan could cooperate in tourism and Uzbekistan Airways had already started regular commercial flights (two-three times a week) between Lahore and Tashkent. More than 20 Pakistani tourist companies had signed MOUs with Uzbek companies, he added.

He said both countries were considering possible options for cooperation to exploit energy, particularly gas, in the near future, adding Uzbekistan had already been supplying electricity to seven northern provinces of Afghanistan. “So it is a matter of time and negotiations to extent these supplies to Pakistan,” he said. He said Uzbekistan had confirmed stocks of gold, copper, natural gas, tungsten, potassium salts, phosphorus, kaolin and both countries could use these items for bilateral benefit. He said Uzbekistan had been undergoing a process of reforms to modernise, democratise and liberalise all spheres of political and economic life besides making judiciary independent and ensuring human rights. He said Uzbekistan’s GDP growth rate accounted for 9.5 percent in 2007 and volumes of its industrial and agricultural production had increased by 12.1 percent and 6.1 percent respectively. He said cities of Samarkand, Bukhara, Khiva, Shakhrisabz and Tashkent were symbols of Muslim beauty and that the country had potential for production of agricultural raw materials.

He said the country was celebrating 2008 as ‘Year of Youth’ on a proposal of President Islam Karimov. Uzbekistan stood at number three on ‘Social Protection Index for Asian Countries’, prepared by the ADB covering 31 countries, he said. He said Uzbeks had made contributions towards development of world producing great scientists, philosophers, thinkers, religious leaders, commanders and rulers. He said both countries enjoyed cordial relations since the independence of Uzbekistan in 1991. Apart from historical, ethnic, cultural and Islamic bonds, regional cooperation also fostered cooperation between the two countries, he said.

He said he loved Pakistan, which was just like a home away from home for him. “I have good memories of my previous stay in Karachi and my recent visits to Lahore, Peshawar, Mardan, Badin, Sialkot, Faisalabad, and Changa Manga,” he said.

The ambassador said Pakistan was historically and culturally a rich country and its people were great, hardworking, decent and cooperative. Umanov called for more academic and cultural exchange programmes between the two countries. “In this regard, MoUs were signed between International Islamic University Islamabad and Tashkent Islamic University Uzbekistan and Area Study Centre, University of Peshawar Pakistan and Institute of Oriental Studies Academy of Sciences, Tashkent,” he said.

Uzbekistan wants access to Pakistan's Karachi and Gwadar port

 

[UnitedPak]

Dont know who wrote the above article, but 'He said' a lot, me thinks

 

[asaad-ul-islam]

nice post yaar, UnitedPak this made my day! central asia... now the REAL Great Game begins!

 

[Neo]

Gwadar, China rail link not commercially viable: Senate told ​

ISLAMABAD (September 05 2008): The government has informed the Senate on Thursday that linking Gwadar with China through rail is not commercially viable and the work on the project could only be started if it is required by Pakistan and China for strategic purposes.

The Ministry of Railways informed the House in written replies that a pre-feasibility study for provision of rail link from Havelian to Khunjrab on Pak-China border has been completed in June 2008. A separate study has also been executed for linking Gwadar with Mastung. This link would integrate Gwadar with the rest of existing railway network in the country.

The execution of the two projects was necessary for linking Gwadar with China. The Railway Ministry said the project is not commercially viable. The ministry is of the view that project will be forwarded to the Planning Commission with a request that it might be approved for strategic purposes.

An official, when contacted, said that in this regard Pakistan will require the consent of the Chinese government. According to the official, the projects being launched for strategic purposes, require strong commitment from the two sides as such projects are left unattended if strategic purposes are achieved.

In reply to another question, the ministry admitted that 6.79 acres of land out of total 20.66 acres of railway land are in illegal occupation in Quetta. In Chaman, 60 acres are in illegal occupation out of 373.42 acres. The ministry informed the House that it could not spend Rs 1.43 billion allocated for 1000 High Capacity Wagons during 2007-08. The allocation was revised to Rs 162 million against which Rs 142.68 million was spent.

The ministry said that international tender for procurement/manufacturing of 500 high capacity wagons was re-advertised and it is under evaluation process. Besides this, the work on local manufacturing of 30 bogie brake vans has been started out of which 22 have been completed.

Meanwhile, the Interior Ministry informed that Karachi police have made significant breakthrough in reducing the street crimes. These have been reduced by 40 percent in May 2008 as compared to March 2008. There is 50 percent reduction in vehicle snatching, 25 percent reduction in mobile snatching and 18 percent reduction in cash snatching in 2008.

 

[gpit]

Seems there is no detail as to why the link is not commercially viable. Can't be profitable due to high maintenance cost?