INFRASTRUCTURE PRE-REQUISITE FOR GROWTH & DEVELOPMENT
Oct 29 - Nov 4, 2012
Logistics and transportation that plays the fundamental role in a vibrant economy is the potential area to attract huge foreign investment but unfortunately this key segment of the economy has not been given the desired priority by the policy makers.
Whatever the reasons may be yet there are some glaring examples of the neglecting the development of infrastructure for taking advantage of plenty of resources for boosting the economy. In the respect Thar coal field is one of the examples of neglect of infrastructure even after 65 years of inception of the country. One of the major reasons behind untapped energy resources of the Thar coal field is the lack of infrastructure despite the fact that various foreign investors had to investment for power generation by using Thar coal as fuel.
Although recent a road network has been developed to approach Thar coal field yet the scarcity of water and lack of the required infrastructure impeding growth and development of the much sought after energy resources in the country.
Recently, the government of Pakistan has made it mandatory to use coal as a fuel for power generation for all units currently using import fuel oil making the power generation a costly affair. Certainly it is good move and in the right direction, however it is important to mention that power generating units are located from Karachi to Khayber Pakhtun khwah for which proper means of transportation of coal would be required from Karachi to up country. A dirty cargo terminal is already under completion at Port Qasim for import of coal. There is a need for development a fleet of goods train to transport coal from Karachi to rest of the country. Or a proper fleet of trucks to transport from cargo terminal to all the power generating units in the country which calls for improvement in the road net work especially in Sindh. The road conditions in Sindh specially Super high way is not satisfactory and need up-gradation to ensure smooth movement of cargo trucks to ensure smooth movement of cargo traffic. It is said that if proper road infrastructure is development of international standards there is a great possibility of international logistic players to invest in Pakistan . Daewoo of Korea is the best example which had started its operations due existence of Motor Ways developed from Lahore to Islamabad .
Gwadar Port is yet another example where lack of infrastructure is a major hurdle in using this port facility transit trade and transportation of goods to the neighboring countries especially for China and Central Asian countries. Although there are some valid reasons that hampered development of infrastructure facility at Gwadar Port especially the bad law and order situation in Balochistan, however in view of the significance of infrastructure to take advantage of its strategic location the infrastructure including rail, road and air links should have been developed either simultaneously or even before the development of Gwadar port as availability of infrastructure could have helped in combating the law and order situation as well.
China is extremely interested in availing Gwadar Port facility because is reduces a distance of more than 2500km as compared to their own port for transportation of goods to the Western part of China. While the close vicinity to CIS countries, Iran and Afghanistan etc offers a huge business potential to logistics industry.
The economy in Pakistan was also deprived of the huge benefits of logistics due to poor goods train facility which is the cheapest source of transportation elsewhere in the world. It is shocking to note that our national carrier i.e. Pakistan International Airline has no freighter in its fleet resultantly foreign flag carriers are taking advantage of the transportation of goods to and from Pakistan .
Recently, Pakistan State Oil has entered into an agreement with Pakistan National Shipping Corporation for shipment of oil through PNSC; otherwise almost 90 percent of our cargo is lifted by foreign flag ships which cost at least $4 billion a year to Pakistan.
AGRICULTUE: Besides that Pakistan would have been a leading food supplier had we properly development infrastructure for transportation of agriculture produce from farm to market, proper management of water resources, agriculture preservation storage facility and ware houses to utilize the given agriculture resources. A strong agriculture base provides great business opportunities for the stake holders in the logistics business. If we look at the growth of agriculture in our neighborhood especially in India they have tremendously strengthened their agriculture and they would be justified if they claim to be a major food supplier in the world market.
NORMALIZATION OF TRADE WITH INDIA
Currently, Pakistan and India are in the process of normalization of trade relations and it seems that time is not far away when the two countries would be engaged in two way trade especially through land routes in Punjab and likewise in Sindh. The cross border trade through trucks would save huge freight charges the two countries have to pay for imports and exports to far off destinations. However proper trucking fleet is required for smooth transportation of goods at a reduce cost.
At the moment, the trucks being used for transportation of cargo goods between India , Pakistan and Afghanistan are mostly comprised of old and shabby vehicles which are not only costing precious fuel but destroying our available road infrastructure. Since no effective cross border rules have been evolved for loading and unloading of cargo goods, the trucks are openly violating the rules by over loading their trucks to create traffic hazards, cause fatal road accidents and damaging the road infrastructure.
For the cross border trade there is a need for proper legislation to facilitate two way trade, which calls the attention of the policy makers to take advantage of the available cross border trade opportunities. Cross border trade is a major economic segment in the development such as European Union where bulk of trade is taking place through trucking which has attracted international logistics players to generate economic activity at a massive scale in Euro zone.
Though trucking policy exists but it is out moded and needed to be revamped to respond to the current needs of the industry besides ensuring implementation of the transportation policy in letter and spirit to help developing image of the country in this fields as well.
Similarly in the shipping business the law of bill of lading is as old as 1860 which is still in vogue while the situation has altogether different from what it was in 1860, we should come up and evolve laws in accordance to domestic needs responding and comply with current need of the economy.