By SYED M. ASLAM
Dec 31, 2001 - Jan 06 , 2002
The Pakistan Merchant Marine Policy 2001 was
announced by the government on July 10 this year. The main objective
of the policy is to deregulate the shipping sector providing equal
opportunities to both the private and the public sector and a free and
conducive environment for investment.
The policy seem to have attracted a group of
expatriates willing to invest in the shipping sector along with local
participation. The Karachi-based local partner of the group, who ask
not to mention his name to avoid unwelcomed querries, shared his
concerns with PAGE.
Perhaps nothing underlines the merits of having a
strong national merchant marine than the indications of hostilities by
neighbouring India and the threats of eventualities which it has
resorted to in recent weeks. Over the years, PAGE has consistently
advocated for the importance of having a strong merchant marine fleet
and the continuous miserable decline of the state-owned Pakistan
National Shipping Corporation.
The executive summary of the policy expressed the
similar views saying that the Pakistani maritime fleet and support
services is miserably inadequate to meet the challenges. It added that
Pakistan's present annual trade is 39 million tonnes, only 5 per cent
of which is lifted by the PNSC.
The heavy dependence on foreign shipping lines
casts shadows not only at the continuous flow of seaborne trade in
case of perceived or real eventuality particularly if viewed in the
present situation, but also bleeds the economy. Pakistan spends about
$ 2 billion a year on shipping which makes it second top expense after
Interest to invest in the shipping industry,
particularly in the prevalent scenario, is a welcome sign indeed. The
concerns of potential investors offer an opportunity to help address
to their satisfaction to help them bring the much needed tonnage in
the national maritime fleet.
The local participant of the potential expatriate
investors calling the policy 'perfect' also thanked PAGE for
being the 'mover' behind the formation of the policy. "All of the
recommendations made by PAGE in 1997 were included in the
policy and I appreciate the efforts."
However, he said that the 'perfect' policy needs to
be immaculately implemented in the letter and spirit. "While I am
much pleased with my meetings with high-placed officials in the
relevant departments and ministries and have been encouraged by their
positive response. However, I can not say the same about the PNSC and
its subsidiary the National Tanker Corporation (NTC).
"There are indications that they may
jeopardize any potential investment encouraged by the policy one of
main objective of which is the creation of a level playing field in
the maritime sector. For instance, clandestinely entering a 10-year
contract with Pak Arab Refinery Company (PARCO), the major importer of
crude oil. It would be unwise to ignore a happening like this by the
concerned quarters such as the Ministry of Petroleum and Natural
Resources and should not have been allowed to happen in the first
Asked just what kind of investment and vessel the
group is interested to induct in the national fleet under the
Pakistani flag, the source said that if all goes well they are
interested in bringing a used crude oil tanker of 85,000 Dead Weight
Tons (DWD). "We are ready to initially invest between $ 8-10
million to procure a used 1981-built container in good condition and
have it registered under the national flag as little as three months
subject to the removal of our concerns such as above.
The source said that the potential investment will
create about 30 jobs on the ship and many other direct as well as
indirect jobs in Karachi. The investment would also help retain funds
within the country and to help reduce drain of foreign exchange. In
addition, it will help expand and upgrade the strength of the national
merchant marine fleet. "Most of all the government would not have
to bail out the PNSC financially, which has happened in the past and
may happen once gain, by doling out huge public funds which can be
diverted to one of many better uses."
Salient features of the Merchant Marine Policy-2001
To create an environment conducive for the growth
of the maritime sector by providing equal opportunities to both the
public and private sector. To create a free environment for investment
in the maritime sector. To promote efficient related service
industries, institutions, ports and harbours.
The key targets
To expand and upgrade Pakistan flag merchant marine
fleet to increase the present share of cargo from 5 per cent to 40 per
cent meeting the UNCTAD parameters. To augment national ship building
capacity to meet 20 per cent ship construction requirements of the
country. To expand ship repair facilities.