Monday, May 29, 2023

Govt unable to support Gwadar Plan due lack of facilities

The Cabinet Committee on the China-Pakistan Economic Corridor (CCoCPEC) on Thursday described the Gwadar port marketing strategy submitted by Chinese operators as inadequate, as the government also remained unable to give the necessary assistance to properly operationalize its free zone.

Due to a delay in commencing work on the 300-megawatt Gwadar power plant, as well as a shortage of transmission network, the cabinet committee has agreed to import another 100MW of electricity from Iran to fulfill the port’s energy needs. The CCoCPEC meeting presided over by Federal Minister for Planning Asad Umar, evaluated progress on key CPEC projects as well as the Gwadar Port marketing strategy.

The Gwadar Port and Free Zone are supposed to be the crown jewels of CPEC, however, development on these two key CPEC initiatives has lagged well behind expectations, despite Prime Minister Imran Khan and Chief of Army Staff General Qamar Bajwa making them a top priority. According to reports, the Chinese operators of the port of Gwadar, China Overseas Ports Holding Company Pakistan Limited (COPHC), made a presentation to the committee about the potential of the installation and the marketing plan.

However, cabinet members voiced severe concerns about the marketing strategy and considered it unacceptable, they noted. According to a cabinet minister, the plan lacks clarity on the strength of the Gwadar port, which serves as its strategic position. He also pointed out that there was no mention of industrial clusters that may be established in the free zone.

According to the sources, two federal ministers suggested at the discussion that a way forward must be found since everything cannot be left to Chinese entrepreneurs. However, officials from the marine affairs ministry stated that the government is unable to intervene because of the concession deal inked with the port operators. When contacted, a COPHC senior official stated, “Gwadar port is operational and capable of processing any type of cargo.”

However, the road network is not yet complete, and all Gwadar goods must transit through Karachi, limiting the port’s competitiveness, he noted. The Chinese firm executive went on to say that infrastructure, including electricity, water, and road connections, constitute a block in the development of the Gwadar port and free zone. The Gwadar Free Zone’s future growth is being hampered by land resettlement and incentive policies.

“However, Prime Minister (Imran Khan) visited Gwadar on July 5 and directed the appropriate authorities to eliminate obstacles of Gwadar development, and the port operator is optimistic that Gwadar can be developed as a new economic center of Pakistan with the participation of all stakeholders,” he said.

According to the reports, the Pakistan Coast Guard and Pakistan Navy continue to hold roughly 97 acres of land in the Gwadar Free Zone. However, the cabinet committee informed the port operators during the meeting that occupied property accounted for just 4% of the total zone land and that the operators should hasten operations to develop the remaining space.

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