Glad this is finally settled, and foreign investment continues to flood into Pakistan.
Singapore’s PSA to run Pakistan’s Gwadar port
A consortium led by Singapore port operator PSA International [PSA.UL] has won a contract to operate Pakistan’s southwestern Gwadar port, a government minister said on Friday. “Prime Minister Shaukat Aziz today approved awarding of this contract to PSA,” Babar Khan Ghauri, Minister for Ports and Shipping told Reuters. “They will take charge of the port by the third week of January,” he added. Ghauri declined to give the financial details of the deal, but said the government had constituted a committee to finalise the details of the agreement.
The Gwadar deep-sea port is on the Arabian Sea, about 450 km (280 miles) west of the city of Karachi and about 70 km (45 miles) east of the Iranian border. China provided $198 million for the $248 million port project. Under the concession, the PSA will take over the operation and management of the port for 40 years. Pakistan’s AKD Group is part of the Singaporean consortium.
China helped finance the building of Gwadar port, and the 650 km Makran Coastal Highway. Now Singapore will run the port. While Dubai is planning to invest 10's of billions of dollars elsewhere in Pakistan.
Gwadur Port is to be officially opened up next month - a historic event for Pakistan.
Singapore’s PSA takes over Pakistan’s Gwadar port
Pakistan on Tuesday signed an accord with Singapore port operator PSA International allowing the southeast Asian firm to take control of Pakistan’s Gwadar deep-sea port. Pakistan plans to inaugurate Gwadar port, which is on the Arabian Sea in the southwestern province of Baluchistan, in March. PSA International, which is owned by the Singapore government investment holding Temasek , won the contract to operate the port in December. “With the PSA running this port, down the road this can be a regional hub for sea transport and trade,” Pakistani Prime Minister Shaukat Aziz told reporters after a signing ceremony. Aziz said the first vessel is likely to anchor at Gwadar in March. The government aims to turn Pakistan’s second deep-sea port after Karachi into a free-trade zone. Gwadar is looking to handle transshipment traffic for the Gulf and ports on the Arabian Peninsula. Pakistan also plans to use it as the main trade link with land-locked Afghanistan and Central Asia. “We hope this will be the beginning of an era which will change the map of shipping in the world,” Aziz said. “This can also be a potential energy port for the region. We are also looking at Gwadar as a major refining point as it is located near the largest hydrocarbon reserves of the world.” China bankrolled 80 percent of the project’s $248 million initial development costs. A consortium led by PSA won the contract to operate the port, which is about 450 km (280 miles) west of the city of Karachi and about 70 km (45 miles) east of the Iranian border.
SECURITY WORRIES
**Under the agreement, PSA will run the port for 40 years, during which time it will be exempted from corporate tax. Pakistan has also abolished all duties on any equipment and machinery imported to develop the port for 20 years. **PSA has estimated investment at $5 billion to $8 billion in the project over 40 years.It expects the port will generate revenue of $17 billion to $31 billion over the same period. “Gwadar will be an important and significant addition to PSA’s global network of deep sea ports, which globally provide employment for over 22,000 people across Asia and Europe,” said Eddie Teh, Group chief executive officer for PSA. Pakistan’s AKD Group is part of the Singaporean consortium. Conceived more than a decade ago, the port was delayed repeatedly because of a lack of funds and security concerns. In 2005, Pakistan delayed the port’s inauguration after a bomb killed three Chinese technicians working on the project. Ethnic Baluch militants fighting for autonomy in the province claimed responsibility for the attack
AT a marvelous ceremony, the operational and management control of the newly built Gwadar Port has, eventually been handed over to the Port of Singapore Authority. Though the Port would formally be inaugurated in March but signing of the agreement with PSA is an important concrete step to make it operational. It is a matter of satisfaction and pride for all Pakistanis that the country now has another Deep-Sea Port to cater to the growing trade activities. This should have been done quite earlier but the project remained in cold storage mainly because of lack of will and sincerity on the part of those at the helm of affairs. The present leadership, therefore, deserves credit for translating the dream into reality. We also feel delighted our time-tested friend China that helped us a lot in accomplishing the task. Not only that, Chinese has also expressed their willingness to undertake the important second phase of the port construction and development. Completion of the Gwadar Port project is an important milestone in the economic development of Pakistan.
As pointed out by Prime Minister Shaukat Aziz, it will change the destiny of the people of Balochistan by improving their living standards and providing increased job opportunities. The Government has done well by offering different kinds of incentives for the port operator, who in turn has committed to invest $550 million during the next five years. It has also the potential to become a hub of regional economic and trade activities. However, for this to happen, we will have to shun rhetoric and embark upon an expeditious plan to initiate and complete the second phase of the project to accommodate large vessels. Similarly, speedy development of the port related facilities and other infrastructure is also crucial for success of its operations. It is quite understood that there are several other ports in the vicinity and we will have to make Gwadar competitive to ensure that it attracts cargo traffic. We wish to see that work on new airport and industrial zone also gets started on priority basis to kick-start economic and commercial activities in Gwadar. At the same time, we feel optimistic that the President and the Prime Minister, as before, shall continue to take personal interest to remove all types of bottlenecks that might hinder multi-directional developmental activities in the area. Amid such a vision, dream to bring affluence to Balochistan in particular and Pakistan in general—shall stand translated into a reality—with optimal steadfastness, which exists as sincerity is—its hallmark.