The Ministry of Ports and Shipping has submitted a five-year fleet development plan to the Planning Commission for procurement approval of 14 ships with USAID assistance amounting to $565 million (equivalent to Rs 50.8 billion) for uninterrupted supplies of strategic commodities in times of conflict, wars and emergencies, Business Recorder has learnt.
At present, the Pakistan National Shipping Corporation (PNSC) has 11 ships, of old vintage, which require immediate replacement to meet the present demand of seaborne trade. "The new fleet of 14 ships would ensure uninterrupted supply of strategic commodities such as oil, LNG, raw material and foods/grains, and the lifeline of the economy of the country would be secured in times of conflict, wars and emergencies," sources said, quoting from the plan.
They said that PNSC had planned to follow a deletion programme, which would result in deletion of 9 out of a total of 11 vessels, to replace with new ships. Pakistan's seaborne trade volume stands at 66 million tons. PNSC's share in Pakistan's seaborne trade stands at less than 10 percent in dry sector and nearly 45 percent in the liquid sectors in terms of volume. "This share, when translated into terms of freight, stands at about 1 percent, which is insignificant against the average freight bill estimated at $4 billion per annum," sources added.
They said that PNSC has prepared a five-year fleet development plan, keeping in view the requirements of national trade viz imports of raw materials such as coal and iron ore of about 5 million tons per annum and imports of grains and fertilisers of about 3-4 million tons and about 8 million tons of processed oils by various entities of the government of Pakistan. The plan also caters for future imports of LNG. "The PNSC's five-year Fleet Development Plan has given all the ingredients of an economic and social development project," Ports and Shipping Ministry informed the Planning Commission.
The proposed investment will result in following advantages: (i) provide safe, economical and efficient shipping services to Pakistani trade, stabilise freight rates, save foreign exchange and provide shipping service for country's strategic imports; (ii) the drain of $4 billion in payment of freight bills will be significantly reduced; (iii) uninterrupted supply of strategic commodities such as oil, LNG, raw material and foods/grains, lifeline of the economy of country will be secured in times of conflict, wars and emergencies; (iv) modern and efficient tonnage, being competitive in the international trade, will be a tangible source of earning foreign exchange for the country; (v) a sound platform for recruitment of young seafarers and a source of employment for the educated youths, which in turn will be a source of value-addition in foreign exchange reserves by way of remittances; (vi) a source of progress and development of support services like supply and repair will conversely increase employment; (vii) enhanced shipping capacity in the national trade will also serve as catalyst in improvement and enhancement of port's infrastructures and facilities; and (viii) the established processes of PNSC for acquisition of ships will meet the criteria of transparency, technical and commercial viability.
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