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Future of maritime intelligence and CPEC as the seed for Logistics’s industry growth in Pakistan

A nationwide campaign of Bahria University to promote country’s blue economy

Global sea ports have great importance for world economy as global container traffic has grown by an average of 10% annually since 1990. Equally, the steady growth of ship sizes poses major logistical and technical problems worldwide. Given these facts, shipping and maritime logistics would largely benefit from Big Data as well as the emerging digital technologies. Apart from the many positive effects of digitization in maritime logistics with respect to efficiency, safety and energy saving, there are, however, also risks (e.g. data abuse, cybercrime). In maritime logistics, automation and digitization are constantly advancing with noticeable affects. Today 90% of the world’s goods are handled by sea and every year 8 million tons of goods are transported across the sea i.e. by container ships, tankers and bulk carriers. The total capacity of global container fleet increased to approximately 20.5 million TEU in 2016 as compared to 2013 and compare with world trade and GDP; sea trade has shown twice as fast growth in recent years. Maritime logistics is thus one of the key sector for digital transformation with its high degree of networking and its large number of interfaces as it offers a broad range of applications for digital technologies.

Therefore, modernization of logistics will provide massive expansion in business to the maritime shipping companies. Traffic, port logistics and just in time shipping will change as an electronic revolution taking the shape with big data and increase in networking of technologies. Now a days a large number of data is gathered on each individual ship, although most of them are unused. However given the multitude of new digital business models, data usage will inevitably change within the coming years. International Maritime Organization (IMO) supports the introduction of electronic data exchange from ship to ship and from land to ship to improve the efficiency, safety and data security of navigation and communication. Thus, for the digital linking of complete value chains in maritime logistics numerous development in GPS navigation, accuracy in arrival of ships, weather forecasts and smart container technologies are based on AIS (Artificial Intelligence systems).

Smart ships will revolutionize the landscape of ship design and operations, redefining the maritime industry and the roles of the players in it with implications for shipping companies, shipbuilders and maritime systems providers, as well as technology companies from other sectors. It is also an established fact that smart/digitalized and efficient ports are the element for better logistics which will return in the form of better trade. Similarly, the successful actualization of CPEC (between Pakistan and China) will also require a robust logistics mechanism for which collaboration between logistics industries of Pakistan and China is mandatory, Gwadar Port has huge potential of transforming not only the blue economy of Pakistan, but also the game changer for the entire region.Logistics industry is the backbone of any economy in the modern world and by creating an integrated and efficient logistics and transportation system Pakistan is seeking to upgrade the national transportation infrastructure, as per the vision 2025. The strengthening of the transportation network and the logistics infrastructure depends on the speedy development of the special economic zones and the industrial parks that are along the China Pakistan Economic Corridor (CPEC).

 

The contribution of the road freight is ninety percent of the cargo that is transported by land and share of the rail freight is likely to increase due to the transformation and expansion. Development of the road network is of high priority. The private sector participation in the logistics infrastructure development is expected to increase. Transportation and warehousing are going to be the next big thing in leading the logistics industry in 2016 till 2020. The opportunities in the logistics and freight forwarding industry of Pakistan are estimated to be thirty one billion dollars approximately in 2015. Inter provincial high speed connectivity, reduced prices in transportation cost, rural and urban areas to be connected effectively, these are a few targets that are set in the national development strategy for the transportation sector. The primary macro level development for the logistics industry are the up gradation of all the major airports and the trans-shipment hubs, e-commerce, innovation of the railways for effective rail transportation and developing state of the art cargo villages. China Pakistan Economic Corridor projects envision to completely revamp the land transportation and all the infrastructures related to logistics by creating cargo villages and building logistic parks.

Warehousing and storage requirement are increasing by every passing day ever since the CPEC has taken off. CPEC related industrial corridors are demanding increased storage and warehousing facilities and most of all cold chain logistics demand is increasing. Building a one of its kind cargo village will help facilitate good cargo influx to the central Asian states and Pakistan can be a major trans-shipment hub in the region.

Pakistan is facing a very serious issue of lacking formal logistics and supply chain industry and with the new arrangement of CPEC, there is no doubt that the role of logistics becomes more vital than ever. In China and Far East, logistics has been developed as a separate entity and industry. Fleet, which is the backbone of logistics, plays the key role in the overall efficiency of movement of trade goods. If the overall fleet is outdated, the cargo movement gets hampered and affects environment and now a days when everything is revolving around CPEC, so Pakistan should focus to develop a Logistics Development Bank in Pakistan and facilitate small companies. The CPEC could go far towards easing Pakistan’s long-standing supply-side bottlenecks, lifting its long haul potential yield and improving force supply for fares. Transport framework (streets, rail and port) will permit simpler and minimal effort access to residential and abroad advertises, advancing between provincial and worldwide product exchange. Administrations exchange will likewise profit by the expanded exchange traffic from China and the activity would demonstrate to be an impetus for private business venture and boosting profitability.

There is significant desire that CPEC will catalyze expansive based increasing speed. Be that as it may, CPEC can’t turn into our next medium-term advancement plan, which must have a more extensive canvas, including goals for social and human markers. In any case, it can turn into the methods by which inward profitable limit is recovered over the mechanical, rural and business areas.

Hence, there is a strong need to work on the issues through appropriate policies in order to enjoy full benefits from CPEC in future having immense potential so we should focus to make the most of this opportunity for seeking sustained economic development and securing our socio-economic future.

The contributors for this article are Rear Admiral Mukhtar Khan (R) HI(M) DG Bahria University Karachi & Ms Urooj Aijaz (Faculty Bahria University Karachi, Dept of H&SS)

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