Professional Documents
Culture Documents
In 1971 the government nationalized the shipping industry, and merged all
shipping lines under the Pakistan National Shipping Corporation (PNSC).
Later, PNSC went to the public sector also with 90.2% government
ownership and 4.9% private sector ownership. PNSC has a fleet of 22
vessels and its subsidiary, the National Tanker Company, owns one tanker.
The Government has issued 35 licenses to private sector companies, but
so far only two companies have started up - the Tri-Star Shipping Company
with one tanker, and the Millwalla Shipping Company with only one small
vessel. Although there are only two companies under the Pakistan national
flag in the private sector, a number of companies are operating under flags
of their own convenience.
Foreign shipping lines dominate the Pakistan shipping industry. Due to
small size and inadequate capacity, the national fleet is presently shipping
approximately 10 percent of the regular cargo and 25 percent of the liquid
build cargo.
The shipping sector in Pakistan is in its infancy at the present moment.
With no sufficient amount of capital invested into the shipping sector, the
entire fleet of the nation is left to only 24 ships, 17 of which are held by
Pakistan National Shipping Corporation.
The rest are owned by Tri-Star Shipping Corporation and a few other
shipping lines.
The country has two major seaports viz. Karachi and Bin Qasim. Besides,
Gwadar Fish Harbour cum Mini Port has been substantially completed.
Feasibility Study to develop Keti Bunder as a Fish Harbour cum Mini Port is
currently under process.All the ports and the shipping lines are not
sufficient to meet the growing demands of Pakistan and other countries and
regions that these countries cater to. Regions include Kashmir, Western
China, Afghanistan and Central Asian Republics like Kazakhstan,
Uzbeksitan, Tajikistan and Turkmenistan.
of
of
at
of
Coming to the Karachi Port Trust (KPT), he pointed out that the KPT
Chairman, Vice Admiral (Retd), Ahmed Hayat has been incumbent for the
last seven years although the official tenure for a single chairman was
limited to three years.
A few of KPT berths had collapsed in early of August this year due to lack
of proper care. Unfortunately, the KPT is engaged in developmental works
outside the port area, making roads and under passes to please others.
The KPT needs to be modernised, as it is the backbone of economy, he
felt.
It is worth mentioning here that the shipping business was limited to only a
few players and the Parsi community was mainly engaged in the business
with just two or three ships in 1947. The PNSC was established in 1960s.
The number of ships in both PNSC and private sector were around 90. In
1972, the government nationalised all private ships. At present, some 60
businessmen are in shipping business directly while it becomes about 100
when those who are indirectly linked to shipping business, are counted.
The business employs about 5,000 people directly while 10,000 people
serve as its indirect manpower. Major foreign ship chartering companies in
Pakistan include MAERSK-SEALAND (Europe), HANJIN SHIPPING
(Japan), MALAYSIAN SHIPPING (Malaysia), WOCL (Singapore) and
AMERICAN PRESIDENT LINE (USA).
Source: http://defence.pk/threads/pakistan-lacks-shippingindustry.8178/#ixzz4LOPEfyHF
the year of manufacture of the third was 1985. PNSC has not inducted any
new tonnage since the early 1980s when it acquired 14 ships to take its
fleet strength to sixty.
In less than two decades PNSCs fleet strength declined to one-fourth and
today its aging fleet is in a dilapidated state many of which are on the scarp
list.
PNSC has remained in red most of the years since it was established in
1979 when Pakistan Shipping Corporation and the National Shipping
Corporation were merged.
The Corporation earned an operating profit only five times during twelve
years between 1984 and 1995. It reverted back into black for the first time
since 1992 when it posted an operating profit of Rs 59 million in 1996.
However, its accumulated losses soared to a record Rs 526 million during
the same year.
Since then PNSC has managed to improve its financial performance to
earn an operating profit of Rs 282 million in 1997 and Rs 203 million in the
year ended June 30, 1998. However, as of June 30 last year, PNSCs
accumulated loss stood as high as Rs 353 million.
The Chairman of PNSC, Vice Admiral Obaid Ullah Khan, blamed low freight
rates internationally and economic recession as the primary cause of
decline in the operating profit in 1997-98. In addition, he also cited the
slow-down in large-scale manufacturing sector, incessant currency
depreciation and a cut throat competition for the declining profitability.
He also blamed the withdrawal of the Right of First Refusal which gives
preference to the PNSC to lift the national cargo provided it matches the
rates offered by the lowest bidder, for hurting the profitability. PNSC carried
much smaller quantities of such captive national cargo as wheat and iron in
1997-98 which dropped from 2.4 million tonnes to 0.297 million tonnes and
from 1.343 million tonnes to 0.597 million tonnes respectively over the
previous year.
In the half-year ended December 31, 1998 PNSC managed to improve its
operating profit by over six-fold from Rs 15 million to Rs 92 million over the
corresponding period previous year. This was despite a 19 per cent decline
in operating revenues which fell from Rs 2.5 billion to Rs 2 billion during the
PNSC would not be able to ensure supply of even such basic commodity
as oil as it has just one old and dilapidated tanker.
Baghpatee said that he was ready to invest in the shipping sector once
again if the sector was accorded the cargo preference and protection not
only to the PNSC but all the local private sector shipping companies as
freight rates worldwide were low and there was a cut throat competition.
Without cargo protection who would like to invest, he added.
He also said that the government should establish a separate ministry for
shipping like India where the prime minister himself heads the special
committee on shipping. The creation of such a ministry is necessary to
better coordinate the shipping requirements of various ministries. For
instance, ministry of production is responsible for imports of iron ore and
coal; ministry of food, agriculture and livestock makes recommendations
about quantity of wheat imports; while ministry of petroleum looks after the
oil imports. The centralization will help coordinate shipments of various
commodities better to ensure timely shipment at the most economic rate for
the overall benefit of the people and the local shipping, he added.
He attributed the flourishing of the Indian shipping on the much vital
governmental support which is absent in Pakistan. It is a fact that stateowned India Shipping Corporation alone has an envious dead weight
tonnage of 13 million tonnes as compared to just 0.33 million dwt of PNSC
and National Tanker Company. Combined DWT under the private sector
shipping in India adds up to another 10 million dwt.
Even Bangladesh which separated from Pakistan in 1971 has a
merchant marine fleet of 225,000 DWT in its state-owned Bangladesh
Shipping Corporation which serves the trade needs of a country
whose population is three-fourth of that of Pakistan.
Baghpatee expressed concerns at the situation that no attempt has been
made by the government to introduce the new shipping policy, a legal cover
through the endorsement of the Parliament. The fact that the said policy
and the incentives remain good only on paper without enjoying any legal
sanctity speaks volumes about the low priority that the government gives to
shipping, he added.
Baghpatee, whose three vessels, out of the total seven, registered in
Pakistan have been auctioned at the foreign ports where they stayed for
long duration to avoid arrest arising from non-payment of loans from local
Allied Bank Limited, claimed that his company was forced to go out of
business by the vested interests who did not like to see a Karachi-based
company flourishing. "Had Tri-Star been a Punjab-based company it would
have not been meted out the treatment which it was accorded," he added.
Baghpatee expressed absolute pessimism when asked about what the
future holds for the local shipping. "Under present circumstances which
include lack of support on the part of the government, the inability of the
local shipping lines of not to get the cargo orders even if they are the lowest
bidders, the aged fleet which has long past its economic lives, the immense
competition for freight in the international market and the low freight rates
worldwide, and the implementation of stricter IMO security codes from next
year, I see no future for the national shipping. No, I dont even see
Pakistani flagship vessels in the years to come," he added.
He said low freight rates worldwide pose many challenges for the national
shipping as the chartering rates have dropped by one-fourth during the last
few years from $ 21,000 per day to between $ 5000-6000 per day today.
Over 50 per cent of shipping companies today are posting losses due to
slump in the international market but what makes the scenario different is
that unlike Pakistan, shipping sectors the world over enjoys the support of
their governments to lessen the blow, he added.
POST-SANCTIONS IMPACT
The developed countries imposed economic sanctions to punish Pakistan
for using its option to conduct a nuclear test on May 28 and 30 last year.
Like all other sectors it also had a detrimental impact on the seaborne
foreign trade.
Not only the volume of both imports and exports decreased in 1998-99 but
it also forced the foreign shipping companies, which carry the bulk of the
national seaborne cargo, to increase the freight charges by 15.5 per cent
being the remittance adjustment factor. The substantial increase in the
freight charges rendered the Pakistani exports incompetitive in the
international market.
The introduction of dual exchange rate, which asked importers and
shipping companies to buy half of the foreign exchange at official rate and
half from the open market, provided the shipping companies with the
opportunity at the higher open market rate which was over 10 per cent
more than the official rate. This also inflated the prices of exports from the
country to render them incompetitive in the international market.
The restriction to remit the funds to the principals, created problems for the
foreign shipping companies the ultimate price of which were borne by the
importers and exporters who have to absorb the increased shipping costs.
Just how the increased rates hurt the exporters is obvious from the
following examples: Shipping a 20-foot container to the US was increased
by $ 230 per container while that for a 40-foot container went up by $ 460
due to the increased freight charges. Similarly, cost of shipping one tonne
of rice to Sri Lanka went up by Rs 60 per tonne as the shipping companies
charged the exporters Rs 53 for each dollar instead of the composite rate
of Rs 50 which depicts 6 per cent difference.
SHIPPING POLICY- LACK OF IMPLEMENTATION
SHIPBUILDING, SHIP REPAIR
Today, over 20 per cent or 7.7 million tonnes of the total cargo; both imports
and exports, liquid and dry, is containerized in the country. The annual flow
of the containerized cargo has already reached 550,000 TEUs, which with
an average load of 14 tonnes per container adds up to 7.7 million tonnes.
While this offers big business for the PNSC, it is lifting a small portion of the
total cargo due to limited number of container vessels in its fleet. Unless it
inducts more vessels the bulk of containerized cargo business would keep
on going to foreign shipping companies.
CONCLUSION
Years of neglect, absence of long-term policies and the non-implementation
of the ones which were ever devised, have taken a heavy toll on the local
shipping.
No fresh tonnage has been inducted in the PNSC during the last two
decades with the result that today its fleet comprises of vessels which are
an average 18 years old costing it more and more money in repairs and
maintenance to keep them running.
MARITIME SECTOR
Introduction
Significance of the Maritime Sector
The significance of the maritime sector, for a start, can best be emphasized
through an established sequence of linkages:
a. First and foremost, in terms of opportunity, some 90% of world trade by
volume is carried out via the sea. Most countries use their rivers in an
effective manner for inland transportation of people and goods.
b. Secondly, a large number of ships are needed for the purpose of
handling various types of cargo; such ships include container vessels,
crude carriers, chemical carriers, LNG carriers, break-bulk cargo carriers,
general cargo carriers and the list goes on.
d. Fourthly, these ships have to be constructed in commercial yards, which
is another profitable enterprise. These ships also need periodical
maintenance & repairs and hence the need for ship-repair yards. Ship
repair requirements can take the form of emergency docking, machinery
defects, hull repairs, tank cleaning, machinery overhauls, alterations and
repainting. Ship conversion is also a lucrative activity.
e. Now these ships have to be berthed in ports to load and off-load their
cargo; and hence the need for ports. The importance of a port stems from
the fact that it is not only a place for simply handling cargoes, it is much
more than that. The more diverse the range of integrated services it offers,
the more competitive it becomes and the more productivity it generates.
The availability of logistics centers, free trade zones and multi-modal
transportation facilities within the port area enhances its importance. A
number of associated activities, in addition to the value-added services just
mentioned, like ship movement control, logistics management, cargo
handling and transportation, pilotage, tugs, port control, as well as the need
for dredging and navigational aids, automatically get generated.
Comparative Standing
Where we stand today in terms of our maritime prowess can best be
illustrated through a comparative process:
b. Pakistan National Shipping Corporation presently operates some 9 ships
with a total deadweight tonnage of 642,207 which is considerably less than
most private ship-owners in Greece. By contrast, Japan, which controls the
largest number of merchant ships, possesses a fleet of over 132 million
tons (as of 31 December 2010). Most of the general cargo trade moreover
is carried out in container ships, of which PNSC doesnt operate any.
d. The sole shipyard in the country, Karachi Shipyard & Engg Works Ltd, is
doing reasonably well by Pakistani standards, having come out of the red
some five to six years ago. Its profits are however mainly dependent on
ship-building orders from the Pakistan Navy and its competitive edge is not
being put to the test. A case in point is an international tender floated by
KPT some time back for construction of a tug, which was bagged by a
Bangladeshi yard. KSEW has likewise not been able to partake of the huge
requirement of periodical maintenance and repairs of the large number of
ships transiting to and from the Gulf. By contrast, shipyards in South Korea
got orders of $18.5 billion in the first six months of last year. A word of
caution though: while Chinese yards, during the same period also bagged
record orders of around $10.5 billion, it was just 4% of the total yards that
actually secured the orders. Many Chinese yards are accordingly trying to
offset this by expanding their oil rig businesses.
e. The largest port in the country, that of Karachi, is presently handling
around 1.4 million TEUs of containerized cargo and 26 million tons of other
general and bulk cargo per annum. By contrast, the Port of Singapore
handled 32.5 million TEUs of containerized cargo and 227 million tons of
other cargo in 2012. The Port of Singapore, moreover, earns over five
billion dollars in revenue, simply because it provides an array of valueadded services.
Maritime Opportunities
We have seen how big the pie is. The major problem which keeps us from
taking advantage of the immense potential of the maritime sector is a
general lack of awareness and consequently a lack of vision and
capacity. It thus needs to be kept in mind that a vital pre-requisite for
availing the benefits of the vast maritime sector is capacity-building through
maritime education and marine scientific research.
Existing Issues
If we are indeed serious about tapping our enormous maritime potential, a
brief glance at our pressing issues will be in order:
a. The Ministry of Ports & Shipping is currently the only ministry at the
federal level solely dedicated to maritime matters.
distressed about what happens in the sea. Once the proposed Ministry of
Maritime Affairs and the National Maritime Authority emerge from the
shadows as major stakeholders of the maritime scene, they may be in a
position to exert the much-needed pressure on the provincial
Environmental Protection Agency.
j. Marine Scientific Research should be undertaken in earnest, so that the
country is ready to exploit the abundant mineral and gas hydrates
resources of the seabed whenever it becomes technologically and
economically feasible to do so.
Conclusion
So, to recap what we have covered, the size and significance of the
maritime sector has been explained through a sequence of linkages, the
gap between what is and what could be has been illustrated through a
comparative study, our inherent systemic flaws outlined and some
suggestions for improvement offered. If we can but imagine the size of the
maritime pie, the large slice we can have of it, and learn to recognize and
remedy our inherent flaws, we can perhaps start taking the first tottering
steps towards realizing our maritime potential. Just imagine too the quality
of life we would have in our coastal belt if the development of our pristine
coast is planned and managed in accordance with a sound Integrated
Coastal Zone Management plan; if tens of thousands of our citizens earn
their livelihood respectably through the safe and environmentally sound
recycling of ships, through sustainable fisheries, through ship-building and
repairs, though harnessing the power of the oceans and exploiting its nonliving resources, through sailing the worlds oceans as seafarers and
employed in various trades associated with a robust coastal tourism
industry. That day can come soon, as soon as the multi-billion dollar
importance of the maritime sector dawns upon us.
Note: This is the text of a talk delivered at the International Maritime
Symposium on Maritime Potential of Pakistan and Security of the Maritime
Domain held on 14-15 May 2014 at the Pakistan Navy War College,
Lahore. It was also subsequently published as a two- part article in the
June and July/August editions of the Navy News.
SYED
M.
ASLAM
the shipping sector as PNSC is the sole national flag carrier of the country.
The situation also poses serious implications in the post September 11
scenario for the timely and affordable liftings of the national cargoes,
particularly exports, in the post September 11 situation resulting in
imposition of War Risk insurance and perceived uncertainties on the part of
foreign shipping lines.
For years, PAGE has been highlighting the deteriorating conditions at the
PNSC calling for restructuring of the entity on sound professional and
financial lines. Year after year it called for the concerted and solid attempts
to streamline the affairs in the long financially-troubled Corporation. We
have pointed to the challenges in the competition-oriented world of today
stressing on restructuring an entity which is extremely top-heavy and where
the incentives to the staff and workers far surpass performance.
It is an open secret that years of mismanagement, lack of vision and
absence of direction has brought the only shipping line of the country to a
verge of collapse. The deterioration has not taken place overnight and
much of it could have been avoided with prudent planning and informed
decisions no matter how hard they could have been.
Today, Pakistan's external trade, particularly export orders have come to a
trickle in part due to uncertainty about their timely delivery. The situation is
further worsened as PNSC is able to lift only a fraction of the national seaborne cargoes while the country is almost entirely dependent on foreign
shipping lines to lift the cargoes on their own terms. Certainly, the absence
of a viable national shipping fleet has made it easy for the foreign shipping
lines to dictate their own terms as their loyalties do not belong to the
country.
Conflict
Comments
SHIPPING
By SYED M. ASLAM
July 23 - 29, 2001
heavy losses for the half year ended December 31, 2000 to push its
accumulated losses to wipe out paid-up capital & reserves as well as
current assets. With such serious cash flow restraints one can hardly
expect the PNSC to perform any better in the coming years enhancing an
already heavy dependence on foreign shippers even further.
Announcing a policy is a much easy task than implementing it in letter and
spirit. Remember the shipping policy announced by the previous
government in June 1998 and how it failed to induct a single tonnage to the
national merchant marine fleet. Perhaps the reluctance of the private sector
to invest in shipping sector can be attributed to opening and closure of
operations of Tristar Shipping.
To soothe the fears this time around, the Communications Minister added
that the government will constitute a Standing committee under secretary
communications which will take continuous input from all stakeholders to
ensure effective implementation and to make the necessary adjustments.
The committee shall comprise members from the relevant
ministries/agencies and stakeholders from the private sector to meet at
least once every year from the date of promulgation of this policy.
Putting the Pakistan's annual sea borne trade at 39 million tons, just 5 per
cent or 2 million tons of which is carried by the national carrier PNSC, the
minister said that the country's annual freight bill surpasses an staggering $
1.5 billion which is causing a colossal drain of foreign exchange resources.
He said that the new shipping policy aims to attract all sorts of investors
foreign, non-resident Pakistanis and local- to reduce an already heavy
dependence on foreign carriers and to help save substantive foreign
exchange. The policy, he said, aims to facilitate and attract private sector
investment in shipping, create an environment conducive for unimpeded
growth of the maritime sector and to deregulate and provide free
environment for investment in the maritime sector. In addition it aims to
maximise sea borne trade through the merchant marine fleet flying
Pakistani flag, to make the country's merchant marine sector internationally
competitive and to ensure efficient operation of the country's ports and
harbours through availability of harbour crafts tugs, pilot boats, dredgers,
survey vessels and specialised craft.
last of the three ships built for the PNSC by the KSEW in 1983. The ship
was also the biggest vessel [17,200 dwt] built by the KSEW.
Financial incentives
The new shipping policy offer many financial incentives for the would-be
investors. It offers tax exemptions, concessional tax measures backed by
assurances. It also aims at simplifying the rules by deregulating the sector.
To begin with, ships and floating crafts tugs, dredgers, survey vessels,
and specialised crafts purchased or bareboat chartered by a Pakistani
entity flying Pakistani flag will be exempted from all import duties and
surcharges for good 19 years till 2020. This exemption, however, will not
apply to vessels imported for demolition purposes and will be subjected to
the condition that the ships/crafts acquired will be used for the purpose for
which they were procured, that is shipping. In case, the ships/crafts are
demolished within 5 years of their acquisition, they would be subjected to
full import duties and other charges applicable to ships purchased for
demolition purpose.
The policy accords shop-building and ship-repair the status of an industry
under the investment policy which is entitled to all incentives contained
therein.
Ships and all floating crafts purchased or bareboat chartered by a Pakistani
entity and flying Pakistani flag will be exempted from payment of income
tax till 2020. Instead, they will be liable to pay tonnage tax at the rate of one
US dollar per gross ton per fiscal year in lieu of income tax irrespective of
the earnings or whether the operator made a profit or incurred a loss.
The registration fee will be maximum $ 1,000 per vessels upto 100 gross
tons $ 50, 101-500 gross tons $ 100, 501-600 gross tons $ 200, 601-5000
gross tons $ 500, 5001 and above gross tons $ 1,000. There will be a
slightly different criteria of taxation for ships, vessels and all floating crafts
which are though not registered in Pakistan is hired by Pakistani individual
or group under any type of charter other than bare-boat charter. The fee for
such vessels and crafts shall be fixed at $ 0.15 (15 cents) per gross ton per
chartered voyage provided that it will not exceed $ 1.00 per gross ton in
any fiscal year.
in the merchant marine sector of Pakistan. It shall also allow free and
interrupted repatriation of profits made by foreign Joint Venture partners of
Pakistani entities or foreign ship-floating craft owners running Pakistanbased companies and operating Pakistan flag vessels/floating crafts.
Ships and all floating crafts are considered bonafide collatereal against
which financing can be obtained from Banks and DFIs subject to policy of
the financial institution. The GoP will also make best endeavour to obtain
financing from aid donor countries on attractive terms for the specific
purpose of construction/acquisition of new ships and other floating crafts.
Such efforts shall include obtaining donor country financing for construction
of ships and other floating crafts in Pakistani ship/craft building facilities.
The new shipping policy reads good on the paper but would it help induct
private sector-led investment to help fresh tonnage to lessen heavy
dependent on foreign shipping companies which is costing country heavily
in drain of foreign exchange not to mention the security in case of an
eventuality. We have to wait and see as the private sector having witnessed
the failure of private shipping company may act like the proverbial "once
bitten twice shy."
Certainly the PNSC fleet is an old and dilapidated condition six of the
twelve break bulk carriers were built in 1980, four in 1981, one each in
1983 and 1979. Of the three used container vessels acquired in 1996, two
were builtin 1983 and the third in 1985. In less than two decades PNSC's
fleet strength declined to one-fourth today with all its ships in dilapidated
condition requiring constant maintenance and repairs costing huge
amounts of money, increased idling time, short trips for the financially
troubled corporation.
Despite enjoying absolute monopoly, PNSC has remained a financially
troubled organisation during the big part of its existence since it was
established in 1979 when Pakistan Shipping Corporation and the National
Shipping Corporation were merged.
PNSC earned an operating profit only five times during twelve years
between 1984 and 1995. It reverted back into black for the first time since
1992 when it posted an operating profit of Rs 59 million in 1996. However,
its accumulated losses soared to a record Rs 526 million during the same
year.
also the Karachi Port and Port Qasim prefer to give tenders for port
maintenance vessels to foreign companies.
The KSEW thus is not only deprived of its core ship-building activity but
also to receive orders for smaller port crafts by the Karachi Port Trust and
Port Qasim, the two national port maintenance authorities.
This has forced the KSEW to divert its attention from its core activities to
general engineering activities in the recent past. Over the years, the KSEW
has emerged as one of the few heavy machinery manufacturers of the
country. It has undertaken a wide variety of engineering and structural
works for oil refineries, storage installations and oil based industries as well
as engineering workshops, and cement and sugar factories.
Since KSEW works under the ministry of defence, it enjoys the support of
the Dockyard of the Pakistan Navy in the designing, development and
construction of submarines and warships. This support from the Pakistan
Navy in the form of joint venture between the two organisations extend to
designing, development of technical know-how, commissioning/trials and
indigenisation in the construction of small warship and support craft.
KSEW has been a partner in the construction of such vessels for the Navy
as mine counter measure vessel, fast petrol boat, missile craft, floating
docks and tugs. Its close liaison with the Navy has given it the capability to
design and construct various types of submarines, warships and naval
support vessels to friendly countries in collaboration with the navy.
However, a big portion of KSEW facilities lay idle at present due to lack of
shipbuilding and repairing work.
Conclusion
The greatest challenge posed to the local national shipping sector which
primarily comprises the sole state-owned flag carrier PNSC is the
imposition of stricter maritime security codes next year. With a fleet of aging
vessels, most of which are in dilapidated condition, chances are there will
be no flagship carriers in the year to come unless of course the new policy
succeeds to attract comparatively newer vessels by the private sector.
Providing the legal cover to the new shipping policy and its effective
implementation at the earliest possible is necessary to give it the needed
sanctity. As is, the last policy was never provided the legal cover.
SHIPPING
The shipping industry of Pakistan is fast heading towards a total collapse
unless the government takes immediate measures to revive it on war
footing.
By Syed M. Aslam
Sep 29 - Oct 05, 1997
The deterioration in the shipping sector is obvious from the fact that though
the volume of seaborne cargo has increased over three-fold from 9.5
million tonnes to 31 million tonnes from 1971-71 to 1996-97, the fleet
strength of the national merchant marine has declined to less than a third,
from 57 vessels to 17 vessels during the same period. This in turn has
resulted in a sharp reduction in the cargo carrying capacity of the state
owned national carrier, Pakistan National Shipping Corporation (PNSC)
from 635,937 deadweight tonnes (dwt) to 290,356 dwt during the same
period.
The national marine fleet comprises a total of 17 break bulk carriers, 12
with PNSC and 5 with private sector Tristar Shipping plus a oil tanker with
Pakistan Tanker Association, a subsidiary of PNSC. Though PNSC
acquired three container vessels last year they are not included as they are
not lifting any national cargoes being chartered out by the Corporation.
The national shippers are lifting only about 7 per cent of the national
seaborne trade while the rest is being lifted by foreign shippers to cost over
$ 1.5 million to the exchequer annually. The situation would worsen as the
average age of PNSC vessels is 15-20 years and soon many of them
would be up for scrap like many others in last few years.
On the other hand, the private sector Tristar Shipping which has a fleet of
used Korean vessels, is on the verge of collapse due to liquidity problems.
The president of Tristar Shipping, Masood Baghpatee had asked the
finance minister, minicter for communications and the governor of the
central bank to intervene for the immediate release of Rs 100 million loan
by the Allied Bank of Pakistan (ABL) to continue its operations.
Baghpatee had said that the loan is needed to help meet such necessary
expenses as purchase of diesel, to pay wages of crew, insurance and
maintenance of vessels.
He had alleged that ABL was holding Tristars securities worth Rs 653
million out of which Rs 300 has been availed. While Tristar is entitled to
avail 70 per or Rs 457 million of the security the ABL failed to release the
loan.
He warned that failure to get the loan would result in suspension of
operations of Tristar subsequently resulting in unemployment of hundreds
of Pakistani seamen and loss to thousands of shareholders of the
company.
Despite numerous attempts by PAGE to contact Mr Baghpatee and a
number of assurances by his office that he would be replying to a PAGE
questionnaire, no response was received from Tristar Shipping.
Masood Baghpatee, however, choose to fax replies to a PAGE
questionnaire about other shipping related issues in the capacity of
president of National Shipowners Association which forms part of this
article elsewhere.
Coming back to the Tristar-ABL conflict, an analyst said that it is hard to
take sides as the banking arrangement between Tristar and ABL is a matter
of mutual understanding between the two.
The release of loan sought by Tristar depends on what kinds of securities
arrangement it has with ABL and as as the same is known only to the two
parties it would not be right to say anything, he added.
However, he added, the non-release of loans could reflect upon the lack of
faith towards Tristar on the part of ABL and though politicisation could be a
reason he ruled it out.
He added if the Tristar was not satisfied banking with ABL what stops it
from taking its business to any other financial institution.
Tristars operating profit declined sharply by 72 per cent to Rs 27 million for
six months ended December 31, 1996 compared to the same period the
previous year. Its pre- and after tax profits also decreased by 79 per cent to
Rs 14 million and 77 per cent to Rs 12.5 million respectively. While Tristar
Ninety-five per cent of the external trade, both import and export, is carried
by sea. Being an import oriented country 82 per cent of this comprise
imports, the rest export.
According to projection the seaborne cargo would increase to 35 million
tonnes by the year 2000: Liquid bulk 14.2 million tonnes, dry bulk 10.75
million tonnes, break bulk 4.45 million tonnes, and containerised 5.6 million
tonnes.
It is clear that failure to add tonnage would result in increased dependence
on foreign shippers which would keep on costing Pakistan increased
foreign exchange to cater to its seaborne trade.
PAGE talked to a number of players in the shipping industry, including
PNSC and representatives of foreign shipping companies to understand
how they perceive various issues pertaining to the industry.
The general manager planning PNSC, Syed Mahmood Ali said that many
factors are restricting the growth of shipping in Pakistan.
Shipping, he said, has no place on the list of priorities of the government, a
fact which is evident from the absence of a clear cut shipping policy.
He said that an import oriented economy like Pakistan which has no
significant exports allows the ships to carry only a small export cargo out of
the country. He also cited closure of Indian ports to merchant marine fleet
of Pakistan and Pakistani ports to Indian merchant marine fleet as one of
the causes that restricts the growth of shipping.
Costly financing for ship purchase which is a higly capital intensive
business and an unprecedented 26 per cent levies on the import of ships
restricts the growth of the industry, he added.
He said that most of the above hurdles can be removed by good decision
making by the government while the opening of Indian ports depend on the
resolution of political and regional disputes with India.
He hoped that a good shipping policy will go a long way in helping the
industry to pick up, however, the problem of one sided [import oriented]
business would remain.
Putting the average annual growth rate of the national seaborne trade at 2
per cent he added that at present the total seaborne trade is about 37
million tonnes 32 million tonnes imports and 5 million tonnes export of
which only about 6 per cent is lifted by the PNSC.
Terming addition of new tonnage a tricky question, he said that private
entrepreneurs have so far not shown much interest due mainly to financing
arrangement. The government may consider establishing a shipping
finance bank to provide loans to the private ship owners, he said. However,
unless the private sector shows enterpreneurship, shipping has a bleak
future in Pakistan, he warned.
The president of the National Shipowners Association (NSA), Masood
Baghpatee cited inordinate delay in the announcement of shipping policy,
frequent change in government policies and lack of financial support by the
government and financial institutions as some of the major factors
restricting the growth of shipping industry.
He also cited heavy duties and levies on the import of ship and the highrisk involved, for instance heavy losses due to any mishap, detention or an
unfavourable fluctuation in the freight market as factors detrimental to the
growth.
He stressed that the decisions taken by the economic coordination
committee (ECC) on February 24, 1993 should immediately be made
effective for net five years. The tax exemeption be extended at least till the
year 2000, he added.
In addition he said that the Merchant Marine Shipping Bill which is pending
for the approval of the parliament for the last 4 years be immediately
approved as the shipping business at present is being regulated under
Shipping Act of 1923 which makes it impossible to do the business.
A formal approval may be granted for the establishment of private bank in
the shipping sector. The application from the private sector is pending with
the State Bank of Pakistan for three years and the same should be
approved so that capital be mobilised, he added.
Baghpatee said that a comprehensive shipping policy should be
announced by the government without further delay and it must basically
be aimed at the progress of the industry and not for merely protecting
interest of brokers, operators, carters and agents.
Putting the payment to foreign shipowners at $ 1.7 billion annually for
wheat , fertiliser, iron ore, coke, crude oil and other liquid imports he added
that it is expected to increase by an annual rate of 10 per cent.
He warned that the prices of vessels are increasing and any further delay in
the announcement of an incentive package to the shipping sector will not
only result in additional capital expenditure by the Pakistani investors but
will also force the prospective foreign and overseas Pakistani investors to
divert their capital to more lucrative vistas to enjoy better benefits.
It is matter of great concern that our spending on freight to foreign shipping
companies is the biggest expense after foreign debt service and defence
and yet the authorities have failed to allocate due importance to the
shipping industry, he concluded.
Rashid Barkat of Pacific Chartering and Trading, the representative of
Noble Group of Hong Kong, said that shipping has never been given the
status of an industry and thus enterpreneurs are shy to invest without any
support from the government and the banking sector.
He said, it is pitiable that the private sector is made to run from pillar to post
to obtain permission from numerous government departments to place a
vessel, purchased entirely from his own money, under Pakistani flag.
The duty structure on the import of ship, he added, is based on a system
which is centuries old. While the vessel remains outside the territorial
waters of the country most of the time and while the freight is earned in
dollars, the owners are forced to pay huge taxes for bringing in the vessel.
He also alleged that unionism and politics in the shipping office are also
restricting the growth of the shipping sector, making it not only difficult but
also unmanageable.
He stressed that the government should allow flagging under Pakistani flag
duty-free though some duty may be imposed if the owner decides to sell
the vessel for flagging under a third country or for scrap. No income tax
should be charged for five years and ship owners should be allowed to
employ their own crew instead of through the Shipping Office, the
and allowing the foreign investors even up to 100 per cent equity in some
cases may be some of the steps in that direction he added.
An source said that in this era of container business the national flag
carriers has no container vessel and it is imperative to induct container
vessels to meet the container traffic of the country.
The government should not encourage the local shipownership but also the
joint venture with foreign companies to give a boost to the shipping
industry, he added.
While the volume of seaborne trade is increasing, the two national ports,
Port of Karachi and Port Qasim are severely underequipped to handle the
ocean freight.
While lack of space restricts the expansion of Karachi Port, Port Qasim is
yet to be opened for night navigation in spite of repeated assurances by the
authorities.
The Port of Karachi which handles 80 per cent of Pakistans maritime trade
has no shore gantries and there is a shortage of other cargo handling
equipment and machinery.
Though it has over two dozen container yards at East and West Wharves it
is yet to have a dedicated container terminal, Karachi International
Container Terminal (KICT) which is expected to open for business in the
first quarter of next year.
At present the container yards are held by a number of ship agents and the
decentralisation in addition to absence of shore gantries and other
equipment has resulted in haphazard stacking, congestion and irregular
flow of goods.
KICT is built at beh nos. 22, 23,24 and 24 A at the West Wharf to handle
300,000 20-ft containers in the first phase and 400,000 in the second. The
KICT is a joint venture between American President Line (APL) and KPT.
Meanwhile, the Port of Karachi is going to lose one-third or 160,000 of its
container business of 550,000 to Qasim International Container Terminal
(QICT), owned and operated by a foreign consortium.
With the shifting of business by a mega container liner like Maersk, which is
one of the consortium partners of QICT, and seven other lines, the bulk of
whose business comprise container would deprive KPT of a considerable
operating income to fall short of projected Rs 5.05 billion during the current
fiscal.
One other factor that the shipping circles feel is restricting the growth of
shipping is that Pakistani Ports are the most expensive in the region,
though tariffs at Port Qasim are still 5 per cent cheaper than the Port of
Karachi.
Sources said that much depends on the implementation of the Shipping
Policy in letter and spirit. It should also be revised to include many
suggestions mentioned above to help encourage the investment to help
add new tonnage to help ease the heavy reliance on foreign shipping
companies to save foreign exchange.
here that IMO slapped a ban on the use of single hull containers exactly ten
years ago in 1997 but developing countries like Pakistan were given
extended period up to this year to replace single hull containers with double
hull by 2007. However, interestingly the approaching ban did not
discourage the PNSC to induct four used container vessels in its fleet
during the last three years thereby necessitating the induction of doublehull containers by the PNSC at this point in time. According to the IMO
rules single hull containers are not allowed to enter the ports in the
developed countries since 1997 and would no longer be enter the countries
where they were still allowed to operate starting this year.
As mentioned earlier, the four oil tankers in the PNSC fleet are over 20
years old and are thus becoming increasing costly to repair and maintain
thereby rendering them extremely uneconomical. That also highlights the
need for replacing almost one-third, or ten of the total 15 vessels, of the
PNSC fleet within the next few years.
PNSC claims to be lifting around 20 per cent of the national sea-borne
cargoes of 55 million tonnes. Though this shows a substantial improvement
in PNSCs performance compared to around negligible lifting of just
around 6 per cent of national cargo lifting in last five years the figures still
dont represent a true figure because the bulk of this increase has been
made possible by increase in crude oil cargoes while only small increase
has come from dry and containerized cargoes. This has been so primarily
because almost the entire fleet of dry, bulk and container cargo vessels of
the PNSC is in extremely dilapidated state having long past its economic
life. These dilapidated vessels are not able to undertake long voyages, are
uneconomic to run and require frequent and costly repair and maintenance.
The PNSC depends heavily on the captive crude oil shipments as it enjoys
a 10-year contract of affreightment to exclusively transport, on its own
as well as on chartered vessels, crude oil for the three oil refineries of the
country that include National Refinery Limited, Pakistan Refinery Limited
and Pak-Arab Refinery Limited.
The exclusive 10-year crude oil shipment contract for the three national
refineries explains why the Shipping Policy announced by the government
about six years ago failed to attract new shipping companies. PAGE
highlighted the plight of an investor ready to make substantial invest in the
shipping sector who had to shelf his plan because he said that the ten
year exclusive contract to the PNSC for the shipment of crude oil to the
three national refineries just leave no business available for him.
The expected induction of two Aframax oil tankers this year clearly shows
that PNSCs fleet replacement and acquisition plan primarily revolves
around crude oil segment of the shipping vessel with little priority given to
dry and container segment of the business. PNSC aims to improve its
performance by solely focusing on the crude oil cargo thereby heading
towards a loop-sided growth by leaving the dry, bulk and containerized
cargoes open to the foreign shipping companies.
It is time for the PNSC to also focus on improving the health of its dry, bulk
and container fleet that forms a major portion of its fleet. It should induct
bulk and container vessels to help lessen the countrys dependence on
foreign shipping companies that keep on lifting a large portion of dry, bulk
and container cargoes that is costing the country billion of dollars annuallyan expense which is second only to defence expenditure. In the long run,
PNSC would be better off without the loop-sided growth driven mainly by
crude oil business which contribute the bulk of revenue to the PNSC but
does not help lessen countrys dependence on foreign shipping
companies for the lifting of non-liquid cargoes.
PNSC used to have 71 large ocean going vessels in 1971. The failure to
induct fresh tonnage and lack of vessel acquisition and replacement plans
over the years has cut the size of its fleet by almost one-fifth to 15 vessels
presently. It has not inducted any new vessels in the last three decades
and has only acquired used containers and oil tankers to sit on a fleet that
is long past its economic life. It has managed to increase its share in crude
oil business but its share in the overall dry, bulk and container cargoes still
remain low. It seems to be solely focusing on the crude oil segment of the
business with little or no attention paid to dry cargo business. Its time for
the PNSC to start paying attention to the vast dry cargo segment of the
business the bulk of which is being lifted by foreign shipping companies at
a big cost to national economy.
* Full range of port facilities to handle all types of general, gagged, bulk,
break bulk, liquid cargo and containerized cargo with backup
infrastructure.
* First rate multi modal connections with inland transport network
* Close proximity to hinterland saving logistics expenses
* Immense possibility for expansion and upgrading of port facilities in terms
of number of berths to meet dynamic requirement of international shipping.
* Availability of basic utilities like water, power, gas, telecommunications,
rail/road connectivity, banking etc, as part of infrastructure for industrial
development.
* Vast areas of land with direct access to waterfronts for setting up import
based and export oriented industrial cum commercial undertakings.
PRIVATE SECTOR'S PARTICIPATION IN PORT DEVELOPMENT.
Port Qasim has actively sought participation and involvement of private
sector in areas both for port facilities as well as investment in industrial
zones of the port. Port Qasim pioneered the inauguration of terminal
operation by private sector in the country. The entire range of cargo
handling activities i.e. from opening of the hatch of vessel to delivery to the
consignee for imports and vice versa is carried out by cargo handling
companies (CHCs) and terminal operators under one window operation
system.
The performance of Pakistan National Shipping Corporation (PNSC) has
also improved significantly. It is now running in profit with its 16 vessels.
PNSC is continuing with its efforts to add more vessels to its fleet. It is
expected that two Aframax crude oil tankers and one Panamax bulk carrier
vessel will be added during the year 2006-07 and this should enable the
corporation to achieve its growth targets in the coming year. However, with
unprecedented increase in the world oil prices and the resultant steep rises
in bunder prices, the operating expenses and business profitability is likely
to come under strain during 2006-07.
TARGETS ACHIEVED
2005-06
10.631
25.957
1.521
17.782
55.891
9.409
(16.83%)
Gwadar port is the third port of Pakistan Karachi and Port Qasim being
the other two. Gwadar borders on Arabian Sea and lies in the Balochistan
province. It is about 433 km from Karachi and 120 km from the Iranian
border. Gwadar port is located at the mouth of the Persian Gulf and outside
the Straits of Hormuz. It is near the key shipping routes used by the
mainline vessels in the region with connections to Africa, Asia and Europe
and enjoys high commercial and strategic significance. Various
professional studies manifest that Gwadar port's location is the most
advantageous one as an alternative port, which could handle mother ships
and large oil tankers in due course.
China has extended technical know how and financial assistance to
Pakistan. It has once again helped Pakistan in the shape of development of
the Gwadar port, and provided 80 percent of the port's $ 248 million initial
development costs. It would make Balochistan the hub of economic activity.
The Central Board of Revenue (CBR) has issued an SRO amending the
Second Schedule of the Income Tax Ordinance-2001, to grant exemption
from six percent withholding tax to importers of ships and floating crafts,
including dredging and survey vessels and other specialized craft that may
be registered in Pakistan. Notably, custom duty and sales tax exemptions
have already been available on the import of different categories of vessels
but not from withholding tax, which created an anomaly. That has now been
removed on the request of an international company that is interested in
importing as many as 20 maritime vessels.
At one time the shipping sector buzzed with robust economic activity. It had
as many as 60 ocean going ships. But things ran aground consequent to
the Bhutto government's nationalization policy in the early 1970s. Even
when the denationalization process began under successor government,
and a number of ineffective incentives were introduced to rejuvenate the
private industry, maritime industry received little help. A few brave souls
who tried to venture into the field to make a new start found the
environment too unfavourable, with the result that at present there is hardly
any activity in the private sector with regard to shipping. The government
needs to take a fresh look at the sector with a view to encouraging local as
well as foreign companies to launch and expand their activities. That has
become all the more important in view of the huge business prospects that
the deep-sea port at Gwadar holds. We must begin preparing sooner rather
than later to benefit from the big opportunities that are to become available
and, of course, also to utilize the existing ones. Once the port is up and
running it will become a major hub of commercial activity, transporting
goods and, possibly, oil and liquefied gas to and from this region and
Central Asian Republics as well as other parts of the world.
It is, therefore, imperative to chalk out a maritime policy with a long-term
perspective. First of all, the government must focus on removing
bureaucratic hurdles that lend a helping hand to corrupt officials and also
promote red tapism. The existing rules and regulations need to be revisited
so that unnecessary and cumbersome producers are dispensed with.
Secondly, the government must inject a heavy dose of incentives into the
sector.
exchange but also to ensure smooth flow of seaborne trade, which only a
dedicated national merchant marine could do in times of peace or war.
According to Tahir Malik, the office of Ports and Shipping Wing was
established in 1961 to bring the decision making closer to the shipping
industry, which is mainly based in Karachi. The main functions involved are:
1. Shipping industry is to be provided with guidance and policy decisions
based on international conventions and national rules & regulations. This
wing formulates such policies under the said rules for the industry.
2. Tackling of shipping-related issues on the spot and to give timely
decisions for overall benefit of the sector.
3. Registration of ships and crafts under Pakistan flag and conducting
survey/inspection and issuing required trading certificates.
4. To act as safety administration and ensuring seaworthiness of ships and
crafts in accordance with national and international laws/conventions.
5. Pollution control from ships in harbour and territorial waters.
6. Seafaring is a specialized profession and requires proper training
followed by examination and certification to be in line with acceptable
international standards. The wing is entrusted to undertake this business to
ensure compatibility with existing system of other maritime nations.
7. Seaman Service Book (SSB), formerly known as Continuous Discharge
Certificate (CDC), is a pre-requisite document for ship-board employment.
Its issuance is one of the functions undertaken by this wing through its subordinate office.
8. The autonomous bodies and the field offices which deal with the shipping
industry are placed under the administrative control of this wing.
9. The wing is also entrusted with the responsibility to prepare
developmental plans to affect improvement in maritime sector in
consonance with the international requirement and technological changes
in the field.
10. International conventions pertaining to ports and shipping are initially
examined by this wing and then recommended for ratification by the
Government of Pakistan after reviewing the existing system in the country.
The chief executive and one of the directors of Tristar, Masood Tariq
Baghpatee and Mansoor Khalid Baghpatee were arrested on the charges
of defrauding the Allied Bank of Pakistan of $ 10.85 million as they did not
pay back loans totaling Rs 440 million for the purchase of five vessels in
1994-95.
PNSC's aging fleet is carrying just about 5 per cent of the national
seaborne cargo while the rest is shared by the foreign shippers which cost
the country over $ 3 billion annually. While the freight rates have remained
constant over the last few years, not withholding the present low globally,
the successive devaluation of Pakistani currency nevertheless has put a
tremendous strain on the national economy to cater to its seaborne trade
needs, which makes it a second top expenditure after Defence, he added.
Karachi, which is a banking and financial capital of the country, has also
distinction in the country's economy due to having the Port of Karachi and
Port Qasim which are the two main seaports of the country. Sea fright
charges from Pakistan are higher as compared to the neighboring
countries. This affects export, as high freight cost affects prices. The
exporters demand that the government should consider bringing down
freight charges by negotiating with the shipping lines or subsidizing the
charges.
According to sources in CBR, Prime Minister Shaukat Aziz had formed a
task force on National Trade Corridor (NTC) Development.
A Trade Facilitation Committee under National Trade Corridor Improvement
Project (NTCIP) was formed with the broad mandate of rationalizing port
charges and dwell time. Major trade facilitation measures -- reduction in
clearance time/ dwell time, developing freight forwarding, shipping,
warehousing & dry ports development, cold chain improvement,
modernizing trade & transport logistics practices, developing a trade
facilitation strategy, implementing care (customs administrative reforms),
faster and accelerating customs reforms, simplification of ports procedures,
reduction in dwell time with concerted efforts of all stake holders,
development of freight forwarding (FF), insurance, banking in support of
trade logistics revamping / modernizing other trade organizations (such as
FPCCI), publicizing efforts of trade facilitation in the forums of WTO, SAFTA
and ECO -- were the main objectives of TFC, the sources said. According
PSNC is in the process of replacing its old vantage vessels with under ten
years old secondhand Japanese vessels in Phase-I and then shall embark
upon ordering new build/buying resale vessels in Phase-II for its
development/expansion program. The five-year plan envisages induction of
two to three modern bulk carriers preferably by March 2011. Induction of a
Product Tanker and an LNG carrier was also part of the fleet development
plan, which would serve the energy sector of the country. Inductions of bulk
carriers, product tanker, and an LNG carrier would provide PNSC with
diversified business opportunities and enhance shipping tonnage to the
targeted one million tons. This would place Pakistan and PNSC in a
prestigious position within shipping circles of the world at large and a lead
contributor in the development of national economy, the statement said.
The finance ministry has also appreciated recommendations forwarded by
the federal ministry of ports and shipping for considering PNSC as the
official shipping company for all public sector organizations. While talking
about future role of PNSC in rapidly expanding international trade, it is
heartening to note that the corporations in the first phase of expanding its
fleet plan to invest over U$270 million to include eight new ships. PNSC is
making rapid progress despite international recession. However, it remains
to be seen that keeping its efficiency, expertise, and experience in mind
how the foreign investors respond to its interest in forming joint ventures
and seeking direct investment in the corporation.
United Arab Shipping Company has expressed interest in joint ventures in
transporting goods to Gulf States. Kuwait Petroleum, which supplies oil to
Pakistan State Oil (PSO), has also expressed interest in joint ventures. At
present, PNSC carries oil to India, Bangladesh, Sri Lanka, and African
countries.
A long-term agreement is expected with Bangladesh while Shell has
already secured PNSC services for Singapore. It is necessary to mention
about one of the latest inductions in PNSC fleet. MV Malakand was taken
over physically at outer anchorage of the Port of Dalian China on
December 27, 2010. It has 76,830 metric tons deadweight with a gross
tonnage of 40,040 having length 225 meters and breadth 32.20 meters.
This Panamax bulk carrier was built in 2004 by Sasebo Heavy Industries of
Japan.
PRESENT STATUS
The present government is working with the support of other ministries to
improve the port infrastructure, streamline supply chain management and
develop the existing national fleet.
Pakistans maritime sector is important especially in the context of the
China-Pakistan Economic Corridor (CPEC) projects being completed by
2018 and our ports, especially the Gwadar port, which will play a pivotal
role in bolstering regional trade.
The Ministry of Ports and Shipping has decided that all possible support will
be extended to the interested parties who come forward for the
development of this sector for a prosperous Pakistan. It has abolished the
customs duty, general sales tax and withholding tax on the import of ships
and all the floating crafts including tugs, dredgers, survey vessels and other
specialized crafts purchased or bareboat-chartered by Pakistani entities as
well as vessels flying the Pakistan flag.
The merchant shipping of Pakistan, specifically the Pakistan National
Shipping Corporation (PNSC) have played a pivotal role in uplifting trade
and economic activity and supporting the oil supply chain of Pakistan.
In 2015, China and Pakistan signed an agreement of 6 Maritime Patrol
Vessels (MPV) for the Pakistan Maritime Security Agency. According to the
agreement, construction of ships will be undertaken at Karachi Shipyards &
Engineering Works (KS&EW) or builders shipyard, as commercially viable.
PROPOSALS
The following suggestion might remove the suffering of our seafarers and
raise the bar of the shipping industry. We should encourage private ship
owning by giving tax incentives and run the national flag carrier on
professional lines so as to make it commercially viable, which would result
in the growth of national fleet.
Further we make merit the sole basis of selection in the Pakistan Marine
Academy and appoint competent nautical/engineer surveyors and
examiners of master/mates and engineers. This would not only raise the
standard of our seafarers, but also ensure effective compliance with
various IMO conventions/treaties.
Moreover, we should do away with the shipping masters office in Karachi
as a valid seamans book and a seafarers identity document should
suffice. This has effectively been enforced by India to the great benefit for
seafarers of distant countries.
There is need to work jointly with full devotion and dedication in
strengthening our maritime sector by enforcing policies that support our
trade.
Shipbuilding is an attractive industry. Shipyards create quality jobs and
support economic growth. Shipyard activities include ship construction,
repair, conversion, and alteration. They also include the production of
prefabricated ship and barge sections, and other specialized services.
The reforms of the present government in exempting duties and taxes on
the procurement of ships, has finally set the stage for the development of
the maritime sector in Pakistan.
THE CONTAINERIZED
PAKISTAN STAND?
SHIPPING
INDUSTRY
WHERE
DOES
Aug 1 - 7, 2016
FEEDBACK
The global trends in the shipping industry have drastically changed with
containerized cargo shipments taking over the bulk cargos. From cost
effectiveness of shipment to increased convenience coupled with the high
level of security, the growth in containerized cargo at the Karachi Port has
been substantial from 1,590,000 TEUs in the fiscal year 2013-14 to
1,720,000 TEUS in 2014-15. This is an 8.4 percent growth compared to
bulk cargo that experienced 5 percent growth from 41,350,000 tons during
2013-14 to 43,420,000 tons in 2014-15.
This consistent growth in containerized cargo is evident across the globe,
depicting the need for increasing containerization in Pakistan. Not only this,
new and more advanced mother vessels have been in place, which can
greatly be associated with economies of scale, given the conditions for the
vessels to be entertained on the ports of Pakistan.
Currently, the 3 container port capacities of the country are accommodative
of Post Panamax and Post Panamax Plus vessels (capacity of 4,000 to
8,000TEUs of containerized cargo). Larger vessels cannotbe handled at
the current terminals due to limitations of available infrastructure and depth.
This is the very reason for increased time and costs of transportation for
the traders since the cargo from the larger vessels is unloaded, and
reloaded to Post Panamax vessels at nearby ports before arriving in
Pakistan(also known as transshipment). It is obvious that containerization
is the future of sea trade which leaves the need for Pakistan to adapt to the
growing needs of containerized ships to be able to benefit from
advancement and cost effectiveness. Larger container ships berthing at
Pakistani ports could result in lower costs to the end users resultingin
economic and handling efficiencies to trade in Pakistan.
The idea is not so far-fetched with the developmental plans of container
ports underway. The first Deep Sea Container Terminal, also known as
South Asia Pakistan Terminals(SAPT) is a public private partnership
between Hong Kong based Hutchison Port Holdings and Karachi Port
Trust. The new terminal will definitely prove to be a game changer for
containerized cargo trade, with the ability to accommodate the largest
vessels afloat today, the New Panamax Plus and Post New Panamax
WRS, ware house receipt is new concept introduced for Indian commodity
derivative market, to obtain short term finance. Any receipts issued by
central/state warehouse is considered as co-lateral by banks. WRS is an
excellent system to support the market and small traders to get finance.
Indian government has taken initiatives to protect the local
investors/contractors by introducing the short term policy, dredging policy,
marine tonnage, tax scheme for local investors. Even Cabotage Laws are
relaxed to promote growth of coastal shipments.
My humble submission to the government is to ensure the initiatives of
policy 2001 and implemented and extending it to 2030, whilst assuring
preference to Pak Flag in all FOB imports, be it PSO, TCP, Steel Mills, Coal
Plants etc. If, need be, I, am willing to present my view point gratis to
concerned Ministry, enable our Maritime Sector may prosper. I, strongly
recommend registration of ships in tax heavens as permitted by India to
Induce private ship owners to increase our tonnage too.
Since I was abroad, local sources have told me that no new inventive to
Maritime Industry has been offered in the present budget, except reverting
to policy 2001, as announced to be implemented.
H.
KAZMI
There is no denying the fact that despite addition of new ships by the
national carrier the country remains heavily dependent on foreign lines. The
government has chalked out an elaborate plan to revamp Pakistan's port
and shipping but availability of funds remains the key constraint. It is
understood that unless private sector is involved in a big way the country
will remain dependent of the national carrier.
The recent initiative taken by the national carrier Pakistan National
Shipping Corporation (PNSC) must be appreciated. PNSC is expanding its
fleet at a time when many lines are shrinking.
The size of a fleet is determined by its tonnage and not by the number of
vessels it has. In the past, PNSC had 14 vessels but these averaged about
250,000 dwt (deadweight tonnage). According to the latest annual report as
on June 30, 2011 PNSC had 10 vessels with aggregate tonnage of 633,273
dwt.
During 2009-10, PNSC and its vessel-owning subsidiary companies
together performed a total of 538 voyages (inclusive of foreign chartered
vessels and slot chartered vessels) and lifted 7.921 million freight tons of
cargo as compared to 637 voyages and 8.684 million freight tons cargo
during the previous year. A comparison of handling of cargo presents a
disappointing picture because the quantum of cargo is on constant decline.
PNSC had carried 9.451 million tons in 2007-08, which declined to 8.684
million tons in 2008-09 and further reduced to 7.921 million tons in 200910. Handling of liquid cargo remains the key business. PNSC handled
7.227 million tons liquid cargo in 2009-10 as against 7.665 million tons in
2008-09.
PSNC is in the process of replacing its old vantage vessels with under ten
years old secondhand Japanese vessels in Phase-I and then shall embark
upon ordering new build/buying resale vessels in Phase-II for its
development/expansion program. The five-year plan envisages induction of
two to three modern bulk carriers preferably by March 2011. Induction of a
Product Tanker and an LNG carrier was also part of the fleet development
plan, which would serve the energy sector of the country. Inductions of bulk
carriers, product tanker, and an LNG carrier would provide PNSC with
diversified business opportunities and enhance shipping tonnage to the
targeted one million tons. This would place Pakistan and PNSC in a
prestigious position within shipping circles of the world at large and a lead
contributor in the development of national economy, the statement said.
The finance ministry has also appreciated recommendations forwarded by
the federal ministry of ports and shipping for considering PNSC as the
official shipping company for all public sector organizations. While talking
about future role of PNSC in rapidly expanding international trade, it is
heartening to note that the corporations in the first phase of expanding its
fleet plan to invest over U$270 million to include eight new ships. PNSC is
making rapid progress despite international recession. However, it remains
to be seen that keeping its efficiency, expertise, and experience in mind
how the foreign investors respond to its interest in forming joint ventures
and seeking direct investment in the corporation.
United Arab Shipping Company has expressed interest in joint ventures in
transporting goods to Gulf States. Kuwait Petroleum, which supplies oil to
Pakistan State Oil (PSO), has also expressed interest in joint ventures. At
present, PNSC carries oil to India, Bangladesh, Sri Lanka, and African
countries.
A long-term agreement is expected with Bangladesh while Shell has
already secured PNSC services for Singapore. It is necessary to mention
about one of the latest inductions in PNSC fleet. MV Malakand was taken
over physically at outer anchorage of the Port of Dalian China on
December 27, 2010. It has 76,830 metric tons deadweight with a gross
tonnage of 40,040 having length 225 meters and breadth 32.20 meters.
This Panamax bulk carrier was built in 2004 by Sasebo Heavy Industries of
Japan.
Addressing the seminar, PNSC Chairman Arif Elahi highlighted the global
perspective on the role of merchant shipping.
He also briefed about the merchant shipping of Pakistan, specifically the
role of the PNSC in uplifting trade and economic activity and supporting the
oil supply chain of Pakistan.
He praised the efforts of the Ministry of Ports and Shipping in abolishing the
customs duty, general sales tax and withholding tax on the import of ships
and all the floating crafts including tugs, dredgers, survey vessels and other
specialised crafts purchased or bareboat-chartered by Pakistani entities as
well as vessels flying the Pakistan flag.
KARACHI: In order to recognise the recent tax reforms for shipping sector
by the present government, Pakistan National Shipping Corporation
(PNSC) recently held a seminar on "Prospects of Shipping Sector in
Pakistan" in Karachi.
The purpose of the seminar was to highlight the recent exemptions by the
present government on Customs duty, general sales tax and withholding
tax on imports of ships and other floating crafts. The house was full with
prominent representations from Pakistan's shipping industry and
stakeholders both from public and private sectors.
The seminar was honoured by Ports and Shipping Minister Senator Mir
Hasil Khan Bizenjo and COMPAK Commander Vice Admiral Arifullah
Hussaini.
The seminar was aimed to promote shipping sector of Pakistan,
promulgate policies and incentives to ensure growth and prosperity of
Pakistan's maritime sector and encourage and attract local and foreign
investors.
Addressing the audience, PNSC Chairman Arif Elahi highlighted the global
perspective on the role of merchant shipping. He briefed about the
merchant shipping of Pakistan, specifically the role of PNSC in uplifting
trade, economic activities and supporting oil supply chain of Pakistan. He
appreciated the efforts of MoP&S in abolishment of Customs duty, general
sales tax and withholding tax on imports of ships and all floating crafts
including tugs, dredgers, survey vessels and other specialised crafts
purchased or bareboat chartered by Pakistani entity and vessels flying
Pakistan flag.
"I am pleased to inform you that our ministry is presently working in support
with other ministries to improve port infrastructure, streamline supply chain
management and developing of existing national fleet," the minister added.
Bizenjo also highlighted the volatility that prevails in international shipping
and also shared reasons that resulted in recent downturns, which posed
significant risk to shipping market.
ISLAMABAD:
Defence experts have stressed the need for fully exploiting maritime area
of Pakistan to tap its potential.
They were speaking at a seminar on Pakistan: maritime challenges and
opportunities, organised by the Institute of Policy Studies (IPS), here on
Thursday, said a press release issued by the institute.
Speakers included former deputy chief of naval staff Vice Admiral (retd)
Iftikhar Rao and National Defence University (NDU) Department of
International Relations Head Dr Muhammad Khan and a large number of
maritime and defence experts, armed forces officials and others.
Admiral Rao emphasised that Pakistan needed to update and develop its
maritime policy of 2002 and take into account the recent trends and
developments.
India has a three-star naval command based on these two islands through
which it controls Chinas maritime movement by its neck.
Dr Muhammad Khan talked about the challenges to the countrys maritime
interests and the Indo-US plan to establish Indian control over the Indian
Ocean at the cost of Pakistans economic and strategic interests.
The question is: Would the government bail out the long financially errant
Corporation once again like many times in the past by pumping in hard
cash earned to save the one and only domestic shipping company?
By
Syed
May 21 - Jun 03, 2001
M.
Aslam
With the accumulated loss surpassing the paid-up capital and reserves by
Rs 105 million and current liabilities exceeding current assets by Rs 1.5
billion for the half-year ended December 31, 2000, the state-owned
Pakistan National Shipping Corporation is looking at a bleak future.
The question is: Would the government bail out the long financially errant
Corporation once again like many times in the past by pumping in hard
cash earned to save the one and only domestic shipping company?
Despite lifting more cargo and bettering the revenue during half-year under
discussion the PNSC and its subsidiary company, Pakistan Co-operative
Ship Stores (Pvt) Limited, suffered an operating loss of Rs 36.6 million. The
failure to improve profitability despite increase in cargo liftings and revenue
was blamed primarily to the substantial increase in bunker price during the
period which rose to $ 172 per ton over the comparative period the
previous year. The depressed freight market resulting in decreased freight
rate was also blamed as another major set back for the loss.
The notes to the unaudited accounts for the half-year also say that the
Government of Pakistan has restored the 'First Right of Refusal' for the
PNSC allowing it to win bulk imports by the government agencies and
public sector organisations by matching the lowest bid. The restoration of
the 'First Right of Refusal' is seen by the observers as an indication of the
government's plans to help the fledgling PNSC.
The PNSC management has already requested for support from the
Federal Government, which holds 90 per cent of the shares. A bailout this
time around would not be the first for the PNSC The Federal
Government provided a subsidy of Rs 259 million to the PNSC in 1984-85
and the Corporation managed to remain in black for the next two years
thereafter generating losses.
SEMINAR
Federal Minister for Ports & Shipping Mir Hasil Khan Bizenjo told that we
want to establish and developed shipping sector and thats why we are
giving duties and taxes exemption on import of shipping products. Pakistan
National Shipping Corporation (PNSC) will make a key role to make
Gwadar biggest business hub of Pakistan in near future.
Advertisement
Federal Minister for Ports & Shipping was addressing a seminar in Karachi
on Prospects of shipping sector in Pakistan. This seminar was held by
Pakistan National Shipping Corporation. At this moment Federal Secretary
For Ministry of Ports & Shiping Khalid Pervez, Chairman of PNSC Arif Alvi,
Chairman Port Qasim Authority Agha Jan Akhtar, Commander COMPAK
Vice Admiral Syed Arifullah Hussaini and other prominent representatives
of PNSC were present.
The purpose of this seminar was to introduce tax exemption which is
provided by present government on withholding tax and custom duty on
import of ship and aircrafts. On the other hand it will promote the shipping
sector of Pakistan, promulgate policies and attract foreign investors.
Senator Hasil Khan Bizenjo told that new investment will come in shipping
sector. It will create great positive impact on the economy of Pakistan and
sea ports. Further he told that ChinaPakistan Economic Corridor (CPEC)
as well as shipping sector will be developed gradually.
Federal Secretary For Ministry of Ports & Shiping Khalid Pervez told that
current seaborne trade of Pakistan 73 billion tones and we expect that it will
reach 95 billion tones by 2020. Further he told that stakeholders should
avail full benefits from these exemptions of duties and taxes. We are
offering to stakeholders for investment and joint ventures because we are
acquiring new ships for own usage. It will not only save the countrys
valuable foreign exchange and reduce dependency on foreign carriers.
Federal Minister appreciates efforts which is made by the PNSC team in
commercial and financial sector. They are introducing the tax reforms in
organization and thanked them for organizing such as informative seminar
Pakistan is located at a point which lies just besides the route of worlds
72 per cent oil supplies.
Gwadar port needs to be equipped with necessary technology and
infrastructure so that it may not only become a starting point for an
economic corridor towards China but also provide an ideal location for the
empty oil tankers entering the Gulf before reloading for necessary repair
and maintenance, he suggested.
He called for integration between maritime and inland transport systems,
development of corridors and enhanced logistic solutions to take full
benefit of countrys maritime potential.
Rao
vehemently
advocated
that
Pakistan
should
emerge as a shipbuilding country as this industry has proven to be a
catalyst of industrialization in a number of countries which have deep sea
shore and abundant labour force.
A policy board with the prime minister as its chairman has already been
notified since 2007 while a real development is yet to be seen, he said.
He also stressed the need for meaningful diplomatic efforts to counter the
hegemonic designs of India to dominate the Indian Ocean, which it
strategically considers Indias ocean.
He said that the strategic islands of Nicobar and Andaman had 80 per
cent Muslim population at the time of partition but the yardstick of Muslim
majority areas to become part of Pakistan was not applied to them. Today,
India has a three-star naval command based on these two islands through
which it controls Chinas maritime movement by its neck.
TAGS
KARACHI: Federal Minister for Ports & Shipping, Senator Mir Hasil Khan
Bizenjo has appreciated the reforms of the present Government by
exempting duties and taxes on procurement of ships which has finally set
the stage of development in maritime sector of Pakistan.
Addressing a seminar organized by Pakistan National Shipping Corporation
(PNSC) on Prospects of Shipping Sector in Pakistan, he said that his
PRESENT STATUS
The present government is working with the support of other ministries to
improve the port infrastructure, streamline supply chain management and
develop the existing national fleet.
Pakistans maritime sector is important especially in the context of the
China-Pakistan Economic Corridor (CPEC) projects being completed by
2018 and our ports, especially the Gwadar port, which will play a pivotal
role in bolstering regional trade.
The Ministry of Ports and Shipping has decided that all possible support will
be extended to the interested parties who come forward for the
development of this sector for a prosperous Pakistan. It has abolished the
customs duty, general sales tax and withholding tax on the import of ships
and all the floating crafts including tugs, dredgers, survey vessels and other
specialized crafts purchased or bareboat-chartered by Pakistani entities as
well as vessels flying the Pakistan flag.
The merchant shipping of Pakistan, specifically the Pakistan National
Shipping Corporation (PNSC) have played a pivotal role in uplifting trade
and economic activity and supporting the oil supply chain of Pakistan.
This year, steel cutting of first MPV was held at Gouangzhou Wenchong
Shipyard on 29th January. Due to high cost production, KS&EW lost the
construction of 4 ships. Just because of Transfer of Technology agreement
this year KS&EW able to construct only 2 ships out of 6.
PROPOSALS
The following suggestion might remove the suffering of our seafarers and
raise the bar of the shipping industry. We should encourage private ship
owning by giving tax incentives and run the national flag carrier on
professional lines so as to make it commercially viable, which would result
in the growth of national fleet.
Further we make merit the sole basis of selection in the Pakistan Marine
Academy and appoint competent nautical/engineer surveyors and
examiners of master/mates and engineers. This would not only raise the
standard of our seafarers, but also ensure effective compliance with
various IMO conventions/treaties.
Moreover, we should do away with the shipping masters office in Karachi
as a valid seamans book and a seafarers identity document should
suffice. This has effectively been enforced by India to the great benefit for
seafarers of distant countries.
There is need to work jointly with full devotion and dedication in
strengthening our maritime sector by enforcing policies that support our
trade.
Shipbuilding is an attractive industry. Shipyards create quality jobs and
support economic growth. Shipyard activities include ship construction,
repair, conversion, and alteration. They also include the production of
prefabricated ship and barge sections, and other specialized services.
The global trends in the shipping industry have drastically changed with
containerized cargo shipments taking over the bulk cargos. From cost
effectiveness of shipment to increased convenience coupled with the high
level of security, the growth in containerized cargo at the Karachi Port has
been substantial from 1,590,000 TEUs in the fiscal year 2013-14 to
1,720,000 TEUS in 2014-15. This is an 8.4 percent growth compared to
bulk cargo that experienced 5 percent growth from 41,350,000 tons during
2013-14 to 43,420,000 tons in 2014-15.
This consistent growth in containerized cargo is evident across the globe,
depicting the need for increasing containerization in Pakistan. Not only this,
new and more advanced mother vessels have been in place, which can
greatly be associated with economies of scale, given the conditions for the
vessels to be entertained on the ports of Pakistan.
Currently, the 3 container port capacities of the country are accommodative
of Post Panamax and Post Panamax Plus vessels (capacity of 4,000 to
8,000TEUs of containerized cargo). Larger vessels cannot be handled at
the current terminals due to limitations of available infrastructure and depth.
This is the very reason for increased time and costs of transportation for
the traders since the cargo from the larger vessels is unloaded, and
reloaded to Post Panamax vessels at nearby ports before arriving in
Pakistan(also known as transshipment). It is obvious that containerization
is the future of sea trade which leaves the need for Pakistan to adapt to the
growing needs of containerized ships to be able to benefit from
advancement and cost effectiveness. Larger container ships berthing at
Pakistani ports could result in lower costs to the end users resultingin
economic and handling efficiencies to trade in Pakistan.
The idea is not so far-fetched with the developmental plans of container
ports underway. The first Deep Sea Container Terminal, also known as
South Asia Pakistan Terminals(SAPT) is a public private partnership
between Hong Kong based Hutchison Port Holdings and Karachi Port
Trust. The new terminal will definitely prove to be a game changer for
containerized cargo trade, with the ability to accommodate the largest
vessels afloat today, the New Panamax Plus and Post New Panamax
Professional
Essay Writers
Get
your
grade or
using our Essay Writing Service!
your
money
back
Most companies in this domain are struggling with the problem of positive
cash flow. The major challenges facing the shipping industry not only stem
from the economic standpoint, but also arise from strict enforcement of
emission regulations and increasing safety and security issues. The
Rotterdam rules are expected to replace the old Hague, Hague-Visby, and
Hamburg rules. These regulations will provide fresh and fair legal rights to
shippers and other cargo-interested parties. Shipping lines and terminal
operators will be exposed to new legal claims system for damages, stolen
goods, and shipment delays. The criminalization of seafarers is a
prominent issue clouding the industry landscape. Seafarers are subjected
to severe penalties and punitive charges for acts that have nothing to do
with criminal negligence. In addition, carbon emission is a matter that will
ultimately determine the future of the shipping industry. Emission control
measures require the fitting of detectors and making expensive changes in
the machinery deployed on board. This exerts additional pressure on the
shipping organizations that are already struggling.
How Maritime Industry Cope with those Challenges
Under the current circumstances, collaboration shows the way forward.
Additionally, companies must look internally to eliminate non-value adding
activities. Removing "non-value-added" waste or "Muda" from their value
chains and focusing on customer satisfaction, which assumes greater
importance during these testing times, has the potential to help companies
to stay out of the red. Port authorities and operators must optimize
utilization of existing capacities rather than building new ones and dealing
with excessive idle capacities. Ramping up infrastructure capabilities to
Comprehensive
Writing Services
Plagiarism-free
Always
Marked to Standard
on
Time
ORDER NOW
While demand fell, the supply of new vessels continue to grow as the result
of vessel orders placed before the financial crisis. It leds to an oversupply
of tonnage and a decline in vessel prices. Prices for scrap metal in 2009
remain very low and many vessel owners have preferred to hold on and lay
off their ships, hoping for better times to come. As a consequence of falling
demand and increased supply, freight rates have fallen from their 2008
highs.
The great number of disturbing incidents of piracy and armed robbery
against ships - particularly off the Somali coast and in the Gulf of Aden have become an increasing concern not only for the maritime industry that
is heavily affected by these incidents, but also for international
organizations, including the International Maritime Organization (IMO) and
the United Nations.
In the field of maritime and supply-chain security, efforts to implement and
refine relevant legal instruments and standards are ongoing. Noteworthy
environment related developments include IMO's continued commitment to
making progress in a number of areas, including in relation to reducing
emissions of greenhouses gases from international shipping and in its work
towards the establishment of a relevant global regime.
--------Assessing the costs of climate change impacts on ports and, more
generally, supply chains, was seen as important. Understanding the
implications for trade and development especially for developing countries
needed to be enhanced and relevant studies should be carried out
Climate change mitigation in maritime transport and the need to adapt to
climate change impacts posed a particular challenge for geographically
disadvantaged landlocked countries with significant population, especially
for their already volatile trade and development prospects. In that context,
further attention should be focused on the impact of potential mitigation
measures and adaptation requirements for the trade and development
prospects of landlocked developing countries, as well as LDCs [least
developed countries]. In that context, financial and technical assistance, as
well as capacity-building, were important.
-----Having come through what many have described as the worst year in its
history, the global maritime industry is looking towards better days. While
the going remains challenging, there are positive signs that portend hope
for the future. Freight rates are heading up on a strengthening global
economy. The supply overhang of ships is less severe than earlier feared
because of order cancellations and deferments, and slow steaming. The
improved sentiment is trickling down to other sectors of the maritime
industry. As we face the challenges in the year ahead, we see some
encouraging signs of the world economy bottoming out and progress on a
slow road to recovery.
---Climate change is happening and its impacts are already being felt, in
particular in the more vulnerable countries. Unchecked, climatic changes
can reach tipping points resulting in disastrous and irreversible
consequences for humanity. The wide-ranging impacts of climate change
and their potential implications for development underscore the need for
integrating climate considerations into development and transport planning
and strategies. Thus, urgent, concerted and considered action is required
at all levels to ensure effective control of GHG emissions and establish the
requisite adaptive capacity, especially in developing countries. Like other
economic sectors, maritime transport, which is vital to globalized trade, has
a role to play in addressing this challenge. At the same time, access to
cost-efficient and sustainable international transport services must be
safeguarded and enhanced -especially for LDCs, LLDCs and SIDS. Against
this background, and to contribute to the debate, deliberations at the
meeting may help identify relevant policy actions that serve the purpose of
climate change mitigation and adaptation in maritime transport without
undermining transport efficiency and trade facilitation gains. One objective
of the meeting is to gain a clearer vision of the format, scope and content of
a potential new regime on GHG emissions from international shipping and
help ascertain the economic and policy implications of various mitigation
measures, including on trade competitiveness of developing countries. To
this end, and with a view to providing substantive policy guidance in the
This Essay is
a Student's Work
This essay has been submitted by a student. This is not an example of the
work written by our professional essay writers.
EXAMPLES OF OUR WORK
element offer new opportunities that we can harness to enhance the human
element in safer shipping.
Challenge:
Is to increase emphasis on the human element in safer and more secure
shipping, port operations and continuously improve measures to enhance
human performance in the maritime industry.
2.7Technology as a major driving force for change in the maritime
transport sector
Technological developments particularly in communications and information
provide better opportunities for knowledge management to increase
transparency and accessibility to information. Care should however be
taken with regard to possible negative consequences that technology could
bring.
Challenges:
To ensure that when adopting technological developments, they enhance
maritime safety, security efficiency and protection of the environment;
Ensure the proper application of technology in information management
and provide enhanced access to that information by the shipping industry
and others.