GWADAR: As the Iran war disrupts regional shipping routes, the government was urged to utilise Gwadar Port for its strategic location, improve competitiveness and cost rationalisation at other ports, besides improving operational efficiency and turnaround time for vessels and cargo.
A meeting between shipping stakeholders and relevant government departments unanimously agreed on the strategic utilisation of Gwadar Port.
It was chaired by the director general of the Ports and Shipping Wing and attended by officials from the port authorities, Pakistan National Shipping Corporation (PNSC), the National Logistics Corporation (NLC), and representatives of shipping lines operating in Pakistan.
The meeting noted that Gwadar was presently one of the most peaceful and strategically located ports in the region. The participants said that the available capacity and facilities at Gwadar Port should be actively utilised and marketed to international shipping lines. Shipping agents may engage with major carriers, particularly COSCO Shipping Lines, to encourage the routing of transhipment and transit cargo through Gwadar.
It was also discussed the availability of transhipment and bunkering facilities at Pakistani ports, the imposition of additional surcharges by shipping lines, the routing of Pakistani cargo through regional ports, and possible options for managing cargo currently affected by regional disruptions.
It was unanimously observed that port charges in Pakistan were comparatively higher than those at competing regional ports. In order to capitalise on the evolving regional maritime situation, it was emphasised that costs must be rationalised to woo shipping lines.
Participants believed that super taxes and other fiscal measures imposed by the Federal Board of Revenue negatively affected trade competitiveness and called for their review or rationalisation.
The members clarified that additional surcharges imposed by shipping lines largely stemmed from increased war risk insurance premiums, as Pakistan had been categorised as a higher-risk region due to geopolitical developments. To address this issue, the government may consider providing sovereign guarantees or engaging diplomatically through the Ministry of Foreign Affairs and Pakistan’s High Commission in London with Lloyd’s Register and clarify that Pakistan was not directly involved in the ongoing conflict and therefore the war risk premium should be reassessed and removed.
Port-related processes
The participants noted that port-related processes required further streamlining to improve operational efficiency and reduce turnaround time for vessels and cargo. It was observed that on-dock container terminals were facing capacity constraints, particularly due to long-stay cargo and Afghan transit cargo. In order to optimise port capacity, such cargo may be shifted to off-dock terminals. It was recommended that off-dock terminals be utilised more effectively to maximise cargo handling capacity and reduce congestion within port terminals.
Shipping agents also highlighted that while larger container vessels were accommodated, adequate berth windows and operational support should also be ensured for smaller vessels to maintain service diversity. In addition to containerised cargo, break-bulk cargo already available at ports should also be considered and facilitated for transhipment operations. The potential role of the PNSC may be explored in facilitating cargo movement through arrangements such as tonnage charter, which may help reduce cost pressures.
Participants emphasised for policy facilitation through Pakistan Customs and the FBR to support transhipment and transit trade. Any necessary relaxations may be introduced through appropriate SROs within the existing legal framework. It was suggested that inter-terminal and inter-port movement of cargo be allowed to enhance operational flexibility.
Transhipment activity
The meeting also recommended allowing ship-to-ship (STS) operations for oil cargo, which would enhance Pakistan’s capability to handle petroleum transhipment. Mandatory scanning requirements for transhipment cargo, particularly at off-dock terminals, may be reviewed and aligned with international best practices to reduce unnecessary delays and encourage transhipment activity. This may be clarified through an appropriate SRO.
Existing restrictions, which limit vessels from calling at both Indian and Pakistani ports in quick succession, may be reviewed to introduce operational flexibility and enable Pakistani ports to attract more transhipment business.
