US, CHINA EYING PAKISTANI STONES

SYED FAZL-E-HAIDER
(feedback@pgeconomist.com)

Mar
15 - 21, 2010

China and United States are eying the huge stone reserves particularly the marble, granite, and chromite in Pakistan's war-torn northwestern tribal areas for their quality and cost effectiveness in the international market. There are heavy deposits of marble and chromite found in the country's strife-torn North West Frontier Province (NWFP) and tribal areas along Afghanistan border.

The US is eyeing on million tons of deposit of marble and chromite of Swat district and Bajaur agency in the NWFP. China has shown interest in purchasing square and regular marble blocks with prices about ten times higher than that of the irregular ones, from Pakistan. The disturbance in the country's north western tribal areas due to ongoing Pakistan's army offensive against Taliban insurgents, has hit hard the country's marble and chromite exports. Foreign investors are reluctant to visit the terror-hit country to place export orders for security concerns. China is the largest importer of Chromite, a strategic stone of black color used in steel-making and steel material for tank-making.

About 297 billion tons of marble and granite reserves are available in the country, according to the Pakistan Stone Development Company (PASDEC).

Last month, a Pakistan-based Chinese firm on its higher bid finalized the deal in stone auction announced by the PASDEC. Chinese have already made deals for 2,000 tons of Kolan beige and two grades of Mastung beige quality marble in southwestern province of Balochsitan. Some 6000 tons of Kolan and Mastung blocks were reportedly auctioned at the rates of Rs 10800 and Rs 8900 per ton, respectively.

Importers from China and United Arab Emirates have particularly shown interest in importing square regular marble blocks extracted from Balochistan, according to a press release recently issued by PASDEC. Chromite is currently being exported to China at Rs42 per kilogram.

United States has evinced keen interest in determining the country's chromite, marble and granite reserves in view of growing world's consumption.

Amongst the building stones, marble occupies a unique position. Marble slabs and handicrafts have great demand in national and international market.

Pakistan is rich in marble resources, located in Balochistan, NWFP, Punjab, FATA (Federally Administered Tribal Area), and in its Northern Areas. With 64 types of marble, the country possesses one of the world's largest marble and granite reserves. Though the country has an edge over its neighboring countries including India and China, yet 85 percent of its marble is wasted due to blasting, as it lacks modern technology and proper facilities and the slicing equipment to improve the quality of its products.

The NWFP province and the FATA are endowed with inexhaustible deposits of different colors and shades of marble and granite. Pakistan's northwest tribal area or FATA comprises of the seven agencies- Mohmand, Bajaur, Khyber, Kurram, Orakzai, North Waziristan and South Waziristan. Huge reserves of highly valued white marble in Mohmand Agency, gray in Bajaur and other attractive colors in Mohmand, Khyber, Orakzai, Kurram and Waziristan have been identified. Presently, all the marble cutting and polishing units in NWFP are closed due to ongoing fight against Taliban militants. The provincial government has also banned the blasting for mining purposes, which has stopped the supply of raw material in the province.

The country's export of marble, granite and onyx products during September 2009 stood $2.42 million as compared with $3.62 million in same period last year, according to the Federal Bureau of Statistics (FBS). During July-September of current fiscal year 2009-10, the exports of these products remained $7.7 million as compared with $8.99 during same period in the last fiscal year 2008-09.

In the last fiscal year, the country's export of natural stones increased to $35 million from $22 million in the fiscal year 2007-08. The marble products export was also hit by load shedding and it failed to meet the set target of $60 million in the last fiscal year.

Mining and quarry sector contributes nearly 0.6 percent to the country's Gross Domestic Product (GDP) with an estimated value addition of more than Rs16.5 billion. The government has already approved the site for the construction of Karachi Marble City, as major export is being done from Karachi marble industries.

Karachi's marble industry shares around 90 percent of the country's exports. Around 45 percent of the processing units have doubled their production in Karachi, the biggest marble estate of the country.

The country plans to use modern technology for reducing the losses and increasing marble exports to $500 million by 2011. Local experts believe that there is an export potential of about $ 1 billion in marble and granite sector. In order to achieve the $500 million export target, PASDEC plans to establish seven marble cities across the country.

The resumption of quality production in the first Marble City Rislapur in Nowshera district of NWFP is expected to fetch better price in the international market. Last month, the PASDEC allocated 199 industrial plots to the stakeholders in Marble City Risalpur for establishment of marble industrial units through a transparent balloting system. Risalpur would be the most technologically advanced and modern industrial estate of dimension stone. Spreading over 185 acres, the Risalpur estate will be beneficial for major quarry clusters of NWFP and FATA.

PASDEC is committed to develop the country's marble and granite sector by transforming it into a dimensional stone industry. In 2008, PASDEC established the country's first model quarry in district Khuzdar in Balochistan with six million tons extractable marble reserves. The model quarry brought in use modern machinery and technology to extract marble square blocks.

The PASDEC has made a plan to establish 10 model quarries, 20 quarry upgradation, 2 machinery pools, 4 common facility and training centers, 2 warehouses and 7 marble cities throughout the country.

Balochistan has a share of nearly 50 per cent in Pakistan's total marble production. Commercial marble occurs at a number of localities in Lasbela, Khuzdar and Chaghi districts of the province. The province is also a major producer of granite and onyx raw material but their deposits are yet to be assessed properly. Marble in Chagai district is of onyx variety. The term onyx signifies a banded variety of quartz, highly prized as an ornamental stone. For its vast applications and uses, onyx marble has great demand in the international market. Out of the country's total 1,095 units, the province has only 60 small marble processing units.

The marble industry is faced with many problems in Balochistan. The industry lacks the technical facilities, as it has been neglected. The industry directly depends on the marble quarries. The province has undeveloped and unsecured marble quarries due to which the industry has been losing business. Other problems include improper infrastructure, road network and law and order problem.

A 'marble city' at Gaddani in Balochistan was set up in May 2006 by the former President Pervez Musharraf. About 300 units had been planned to be established in the marble city and some 600 acres of land had been allotted for the purpose. Four units are currently in production at the facility. The investments were made by expatriate Pakistanis from USA, Japan, Spain and the UAE in the units.