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PESHAWAR:
The Prime Minister’s Maritime Reforms Task Force has ruled out the need for building a new seaport and said that Gwadar Port cannot be fully developed without first resolving the issues of security, connectivity and provision of water and electricity.
The statement was made by task force’s Co-chairman Admiral (Retd) Iftikhar Ahmad Rao, who on Thursday shared details of a host of administrative, legal, and regulatory reforms undertaken during the past one and a half years to take benefit from an estimated $100 billion sea economy of Pakistan. Gwadar Port could not be fully developed because of issues related to security, road and rail connectivity, and provision of water and electricity, said Rao while responding to a question. He was accompanied by Secretary Maritime Affairs Nadeem Mehbub and Member Customs Federal Board of Revenue Shakil Shah.
Gwadar Port remains underdeveloped despite being a strategic node of the China-Pakistan Economic Corridor (CPEC). Pakistan and Singapore had signed a 40-year concession agreement in 2007 for the development of Gwadar Port and subsequently the Port of Singapore Authority transferred the agreement to China Overseas Port Holding Company.
The original concession agreement was not in favour of Pakistan, said the admiral. According to the deal, all the port and free zone development rights are with the Chinese company but expenditures were the responsibility of Pakistan, said the co-chairman. He suggested that there was a need to review the agreement but underscored that the country would honour its commitments.
Rao said that Pakistan Navy had vacated almost the entire land allocated for the Gwadar Free Zone, barring about 12 acres. “Pakistan does not need to build new seaports but there is a need to optimise the existing ports, as Gwadar Port is still at its initial stage of development,” he said while responding to another question.
He explained that the Ministry of Maritime Affairs had undertaken a study whether to construct new ports or not. “We have excess capacity and there is no need for building new seaports,” said Shakil Shah, Member Customs. Rao said that the National Ports Master Plan was being drawn up for coordinated development and expansion of the country’s three main ports. The estimated potential of Pakistan’s blue economy is $100 billion but the country is not able to achieve even 1% of it due to the lack of focus on the sector in the past.
Rao said that Field Marshal Asim Munir and Prime Minister Shehbaz Sharif had been focusing on the development of maritime industry since 2024. The task force presented 99 recommendations to the PM and thus far 84 had already been implemented that revamped Pakistan’s maritime sector, he said. To a question about actual benefit to the economy after the implementation of 84 recommendations, Rao said that the potential was unlimited but did not give a figure.
DP World, one of the leading port operators, had shown interest in making further investment in Pakistani ports, he said, adding that connectivity to seaports could not be completed without improving the Mainline-I and II tracks of Pakistan Railways. To deepen the transshipment business, the government was also working on a new package that would offer attractive rates compared to the regional ports, said Shakil Shah.
Rao said that shipping business could not be developed due to high taxes, which had now been abolished in the budget. Compared to 30% subsidy in India, Pakistan was charging 22% sales tax till last month. He added that the country paid $4 billion to $8 billion annually in freight charges that could be saved by promoting more local shipping lines.
National Dredging and Maritime Company has also been established that will improve activity at the three ports. Rao mentioned that Pakistan’s ports had recorded notable improvements in global rankings – Karachi Port climbed 30 places, moving from 99th to 69th position, while Port Qasim rose by 18 places to 56th spot, reflecting enhanced operational efficiency and competitiveness.
Secretary Maritime Affairs Nadeem Mahbub stressed that the government’s vision was to transform Pakistan into a regional transshipment hub. He noted that cargo handling at Karachi Port reached 55.8 million tonnes over the past year, while Port Qasim handled 47 million tonnes.
He announced that the Pakistan Shipping Policy 2026 had been finalised after extensive consultations and would be presented to the federal cabinet later in July for approval. A dedicated transshipment policy had also been prepared to facilitate both local and international shipping clients, he added. The FBR official said the introduction of faceless assessment system at ports contributed to increased revenue collection by streamlining customs procedures. He added that a state-of-the-art cargo management system had also been introduced to improve the movement of goods from ports to inland destinations.
Shah said one of the most successful reforms was the introduction of the faceless customs assessment system, which eliminated direct interaction between customs officials and importers, improved transparency and substantially enhanced compliance.
“Average revenue per Goods Declaration (GD) has increased from Rs6.8 million to Rs7.7 million, reflecting a 16% improvement,” Shah said, adding that import-related tax collection grew 14%.
He pointed out that customs clearance time had been reduced from 53 hours to only 18 hours since the task force was established and the goal was to bring it down to 12 hours over the next one to two years.
The FBR member said the task force also paved the way for Pakistan’s entry into the ship bunkering business by facilitating the formulation and notification of comprehensive bunkering regulations. This week, the FBR notified new regulations for facilitating maritime businesses. He added that dredging work had commenced at both major ports to enable the handling of bigger ships, a critical step towards positioning Pakistan as a regional transshipment and logistics hub.
He said that due to the faceless system, the legal imports of tyres increased 42%, fabrics 41%, toiletries 75% and electronics 105%, reflecting a significant reduction in illicit trade.