The Trading Corporation of Pakistan's (TCP's) decision to handle its wheat and fertiliser imports at the Gwadar Port, under the directives of the Economic Co-ordination Committee, is considered to be "a totally demented approach" by stakeholders here.
The extent of strain on national exchequer, and how much precious resources are being wasted, could be gauged from the fact that, TCP incurs an extra cost, entirely preventable, of Rs 1.1 billion for the transport of urea alone from Gwadar, instead of Karachi or Port Qasim to upcountry alone.
The average cost of transportation of urea from Gwadar is Rs 200 per bag, while the same can be hauled from Karachi of Port Qasim for just Rs 66 a bag.
Same is the case for wheat: the government pays an extra Rs 600 million since the TCP incurs an additional cost of Rs 2,000 per ton more for transporting wheat to Punjab from Gwadar.
Numbers were not available maybe because of prohibitive cost, but handling charges at Gwadar are also between two to three times higher than Karachi Port/Port Qasim.
Questioning the logic of the move, stakeholders said that it is an irony that the government wasted billions of rupees on handling dry cargo from the Gwadar Port, which had poor roads and no rail connections, simply to justify its existence.
They said that if the government used strategically-located Karachi and Qasim ports it could invest billions in saved money on the construction and development of roads and rail links necessary to make Gwadar an efficient transit port.
It was necessary to build infrastructure vital for attracting investments in the resource-rich province of Balochistan.
Highlighting efficiency, they said that basic infrastructure facilities such as road network and rail links connect these two ports to main arteries of the country.
Both ports which are located in the financial capital, with the country's largest consumer market and accessible to varied industries, account for 75 per cent share of maritime trade of Pakistan.
Port Qasim is on the way of becoming the logistical port for dry cargo since clusters of industries are sprouting in its vicinity.
The Planning Commission's task force on maritime, who expressed disappointment over the sluggish operations at the Gwadar Port, believed that the completion of roads and rail tracks would take another four years.
Under the present circumstances, they said, making Gwadar port operational would require government's financial assistance.
In addition to investments on the basic infrastructure, sizeable funds will be required for construction of modern berths and terminals.
Until a proper berth structure is made available, Gwadar port cannot even be used for transhipment to other ports in the country.
Fact is that a peaceful Balochistan is needed more than anything to secure transit trade and bank on geographical advantage of the province.
A top government official said that the Gwadar port project was a "sheer disaster".
The Port of Singapore Authority (PSA) was delegated the responsibility of Gwadar port operations under a 40-year concession agreement that binds the authority to share nine per cent of total revenue earned from the port operations with the Gwadar Port Authority (GPA).
Since March 2008, PSA distributed only Rs 33 million to GPA as its share of revenue from port operations.
Whatever the reasons for the conflict between GPA and PSA, over the past three years, nothing substantive has been contributed in terms of government revenue.
Till the time security situation in Balochistan is not improved and basic infrastructure joining Gwadar with the rest of the country is not established, the dream of Gwadar port becoming a hub for transhipment and international maritime trade, with Afghanistan and Central Asian republics, will remain only an imagination.
Source: Business Recorder