Report unveils Pakistan’s massive untapped maritime potential

ISLAMABAD: Under-utilised ports coupled with tax evasion and fake billing is causing annual losses to the tune of Rs5 trillion to Pakistan’s maritime sector. A news report by The News published on Thursday said that the misuse of Afghanistan-Pakistan Transit Trade Agreement (APTTA) is also adding to these losses.

According to a “high-level task force” report, the exchequer is bleeding Rs3.19 trillion on an annual basis due to the ports not being used to their potential. The continued tax evasion (over Rs1 trillion by some estimates) and malpractices are aggravating these losses. Moreover, restrictions on some routes are leading to missed opportunities to earn revenue.

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Sources said that the report has been presented to the prime minister. The report highlights the losses, and details the missed potential that is not being realised, in economic as well as geo-strategic terms.

Over the last decade, the demand for Pakistan’s ports has increased by 3.3 per cent. Despite that, the Karachi Port Trust (KPT) is using less than half of its total capacity. Port Qasim Authority (PQA) is also nearing half of its total capacity. This is despite the fact that together these two ports are catering to nearly 95 per cent of Pakistan’s imports and exports.

The Gwadar Port Authority (GPA) project is recently completed and is likely to add even more excess capacity to the country’s total potential. However, that too, remains immensely underutilised.

Pakistan’s maritime potential is all the more significant due to the ongoing Red Sea crisis. The News article said that global giants like Maersk, DP World and Hutchison Ports also recognise this investment opportunity and will be readily willing to channel their trade through Pakistan.

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The task force report has also submitted recommendations pertaining to Pakistan’s exclusive economic zone. This 240,000 sq kms belt is officially recognised by the UN and is rich in many ocean seabed resources including oil, gas, and minerals. Leveraging the maritime resources, already at the disposal of Pakistan, could be transformative for economic and strategic growth of Pakistan.