Pakistan’s shipbreaking industry is heading towards closure as the business activities at Gadani have been stopped since dozens of workers were killed in a fire incident on a tanker a month ago. The country has the third largest shipbreaking yard in the world consisting of 132 shipbreaking plots sprawl over an area of 10 kilometers along the beach front in the coastal city. Gadani was the largest shipbreaking yard in the world in 1980s having more than 30,000 direct employees, but the business has significantly reduced after India and Bangladesh entered the market. Gadani is currently producing less than one fifth of the scrap it used to produce in the 1980s. The industry is still a major iron scrap supplier, providing 100,000 tonnes of raw material to thousands of steel units and rerolling mills in the country. The suspension or termination of work will deprive the steel industry of cheap raw material.
The business had been going down for the last many years, but the government recently reduced taxes on scrap metal, which gave a new lease of life to the industry. However, the fire incident brought the shipbreaking work to a halt. The provincial government imposed section 144 in the area and the industry is unofficially closed. The Pakistan Ship Breakers Association has already appealed to the prime minister and the Balochistan chief minister to allow the units at the yard to resume work. Besides catering to the needs of the steel units, the industry is a good pay master for the workers at the yard. The construction industry heavily relies on the steel provided by the ship-breakers. The closure of work has raised the prices of steel in the market. What the government has to do is to introduce reforms in the business and take security and safety measures to minimize risks for the ship yard employees.
It is hoped the federal and provincial governments would come to the rescue of the shipbreaking industry as large scale construction projects are going on in the country in the form of China Pakistan Economic Corridor and motorways and closure of the industry will increase the cost of the projects.
