PDWCP project flounders amid delays

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KARACHI – Amid several delays in both the awarding of dredging contracts and the physical dredging in the Deep Water Container Port (PDWCP) due to a lack of requisite equipment; the Karachi Port Trust (KPT) is still waiting for the delivery of two new dredgers to resume work on the project.
This lack of planning on the part of the KPT has resulted in the relegation of the project as it is behind schedule by roughly three to four years. This has caused not only consternation on the part of the foreign investor involved, but also discouraging it from undertaking further investments, which in turn hurts the national interest.
It has been learnt from the industry sources that the whole project is lagging badly. According to the tender document issued in 2007, the PDWCP project entails KPT dredging the channel, completing the marine protection works, reclaiming the area for terminal construction and construction of the quay wall. When this is completed, it will allow the private operator to compact the terminal area and construct necessary civil works and install equipment.
The double digit growth of container volumes destined for Pakistan alone is increasingly more difficult to sustain and any vision of development must consider the need to develop a capacity to handle regional traffic. Therefore the development of PDWCP is intrinsically bound in any effort to promote Pakistan’s role in global trade and also becomes more important with the increasing trend of larger container ships, requiring more sophisticated equipment and sufficient drafts. A maritime expert opines that the government and KPT are likely to remain focused on PDWCP’s development to make it competitive with regards to other regional ports. He went on to say that it has been reported in the media that the concessionaire for phase 1 of PDWCP, Hutchinson Port Holdings, is disappointed with the lack of action of the KPT and may consider pulling out of the project.
He insisted that this will put back the development of Pakistan ports by another decade and may severally jeopardise Pakistan’s vision of becoming a regional hub and transit point for trade, he added.
It is to be noted that in line with the government’s privatisation policy and may augment economic growth. Currently, all container terminals in Pakistan are operated in partnership with private terminal operators. Pakistan has enjoyed a healthy annual growth of 12 percent in container traffic since 2001, even when the global financial crisis erupted in 2009m Pakistan’s container traffic registered strong growth of close to 10 percent, reaching 2.12 million Twenty-foot equivalent units (TEU), a measure used for capacity in container transportation, in 2009. The expert noted that existing terminals are now reaching their maximum capacity and the potential for further development is stymied due the limitation of the water draught with recent statistics showing that large mother vessels are making more calls to the regional hubs instead of berthing in Pakistan. If this trend continues, the Pakistani ports will be downgraded to serve only feeder vessels, which will render national ports less efficient and more costly, the expert cautioned.
It is pertinent to mention that in order to improve the situation and to potentially provide an opportunity to expand the port’s service base, the Karachi Port Trust (KPT), under the direction of the previous management, made a strategic decision in 2006 to develop the Pakistan Deep Water Container Port (PDWCP) project. The first phase of the project was awarded in 2007 in which KPT and a private operator co-invested approximately $1.5 billion. The phase included the construction of a four berth terminal with 1500 m quay and 15 hectares of back up yard, which would boost handling capacity per annum by 3.1 million TEU.
This commendable vision of KPT to allow Pakistan ports to develop an ability to handle the largest container ships of over 15,000 TEUs by allowing draughts of up to 18 meters. Clearly the government had a vision to make PDWCP a transit hub port in the region, in particular tapping the need of the landlocked Central Asian countries. When completed, PDWCP will be the most advanced container port in the West Indian Subcontinent and Arabian Sea Region, planting Pakistan firmly among the top players in the regional maritime nations.