By Adeela Bahar Khan
Aug 13, 2013
Even in times as challenging as these, abundant opportunities still exist for growth. It is the country’s responsibility to explore and properly exploit these opportunities to the full— by expanding into new markets, finding new ways to innovate rapid advancements of economic structures and taking new approaches to discover and refine local talent.
Since Pakistan is also currently faced with trade deficits and a flailing economy, it is a real hour need to integrate the economy with global markets via new and expanded economic engagements.
Pakistan is blessed with a sea coastline of approximately 1100 km, stretching to the West and Southeast axis. Over 36,000 ships transit through Pakistan’s zone of influence each year. Pakistan’s total annual trade is about 38 million tons, of which approx 95% takes place via the Arabian Sea. Karachi port handles 68%, whereas Port Qasim takes care of 32% of all sea-borne trade. The projected rise in total trade by the year 2015 is 91 million tons, which will increase shipping activity phenomenally at existing ports. In fact, economicdependence of Pakistan on sea routes for trade and commerce is of cardinal importance for the country’s economic survival. Against this backdrop, Gwadar port meets the envisioned targets of its economic viability, which can further be ensured through the development of its infrastructure and assuring and increasing its connectivity with the hinterland.
Gwadar is an important port in this context, with tremendous economic spin offs, situated at the cusp of the Strait of Hormuz and the Gulf of Oman, from where almost 80 percent oil of world trade flows. Besides its geo-strategic importance, the port may serve as a cornerstone of economic development for Pakistan and Balochistan, and has the potential to entirely change the dynamics of inter and intra regional states and the fortune of its people. The port serves as the mother port at the junction of traditional ancient sea routes, opposite the Strait of Hormuz and can serve as the best alternative to the Persian Gulf ports for accommodating large ships and oil tankers. This would also lead to increasing access and control of the transit trade of Central Asian states as well as the facilitation of transshipment between different regions.
The deep-sea port at Gwadar is visualized as a regional capital hub, serving commercial traffic to and from Central Asian Republics (CARs), Afghanistan, the Middle East, the Gulf, Xinjiang, Iran, and South East Asia. The Gulf countries are more dependent on imports from around the world, all except for oil. At present, Gulf is on the focal plate of the world due to increasing instability in region, especially after the Arab Spring. Specifically, impending conflict between Iran and the West which may, at any moment, result in a blockade of Gulf by the West and the US. In this case Gwadar would become even more important as it would be the only choice left for these states. The unique geographical location of Gwadar port provides greater opportunities to our neighbors in the Gulf for capitalizing on trade from China and the CARs. According to one estimate, CARs possess up to 250 billion barrels of petroleum and as well as large gas reserves. As the fossil fuel reserves elsewhere are rapidly being depleted, growing economic powers are now focusing on this region. A number of dream pipeline projects are already at various stages of development, including one that would pass through Afghanistan and Pakistan to reach warm waters through Gwadar. It provides an economical route for the flow of Central Asia’s natural resources to the world along with easy access to the growing consumer markets of Asia. Unfortunately, India has many apprehensions regarding this port, in which the foremost is that Pakistan would have greater control of more of the world’s energy circulation and Indian tankers will be excluded.
Beside this, sour relations between Iran and the US and Western countries provides enough reasons for the international community to opt for Gwadar rather than another port in the Persian region. Due to these factors Gwadar is going to be the home of major shipping competitors as it is the most efficient route to Indian Ocean for world markets. Therefore, keeping in mind the importance of Sea Line of communications (SLOCs) for provision of uninterrupted oil supply, Gwadar port would provide a much-needed alternate for Karachi/ Qasim ports. As soon as Gwadar goes operational, the establishment of special economic zones, free trade zones, and Export Processing Zones (EPZ) will attract foreign investment creating a rapid socio-economic uplift for Balochistan and will be witnessed via the change in the living standards of people dwelling in the backward areas of Balochistan.
Furthermore, the unique and attractive landscape of Gwadar has immense potential to attract national and international tourists. The mud hillocks, the God gifted landscape looks as if engraved by an artist. The turquoise sea water with golden sand beaches facing south is unparalleled.
Today, the major super powers are focusing on the Middle East and Asia with the primary concern of protecting economic interests in the form of free flow of oil from the Gulf region, as well as tapping the natural resources of the Central Asian Republics. Gwadar holds an important key to Pakistan’s socio-economic prosperity particularly for the Baloch people, by ending an era of deprivation, and encouraging them to work for regional progress and prosperity. However, Pakistan needs to adopt a balanced approach to ensuring stability, security and cooperation rather than conflict and confrontation with its neighbors, as well as the international community.
The writer is Research Associate at Centre for Pakistan and Gulf Studies, Islamabad.