EMERGING ASIAN ECONOMY – "MARITIME PERSPECTIVE"

Dalian, in China is blessed with reputable Maritime University affiliated with World Maritime University Malmo, Sweden. The product of Dalian University is compatible to world standard, so is the ship building industry has grown to the extent that newly built ships are competing with South Korea and Japan. The stringent quality standard of international classification societies are complied to deliver a product inferior to none.

I, was also amazed to see the Shenzhen Port, a marshy land, transformed into Container port handling 10 million TEU, with only 3.7 square Kilometer of land. The Port has 22 meter draft and handled largest Container ship of China Shipping of 19100 TEU.  The technology is the most up-to-date as sitting in Yantin International Container Terminal (YICT) play with koy sticks to control the handling containers with no gantry’s operators. The in-house built software is used, instead of branded ones, promising efficiency. The maximum time of a trailer in port is restricted to 30 minutes, whilst train logistic is connected to port as well.

It, was interesting to see the YICT at Shenzhen Port auto gate project, built on the electronic data inter change platform and the optical character recognition portal, the innovative 70 automatic in gates and out gate lanes enable precise transmission of information and rapid direction to yards, thus improving the terminals operational efficiency, ensuring timely departure of ships, within 8 hours. The port has Shenzhen –Yantian is an integrated bonded area, with off dock ware houses too. YICT cranes are equipped with high pressure sodium lamps, which consume less electricity than conventional lamps. The latest LED lamps are using 75% less electricity. The Shenzhen Port has 16 deep water container berths, 74 gantry cranes, 200 yard gantry cranes, with total berth length of 7885 meters. The world mega box ships are calling to this port which caters mainly to export from China.

 My study tour of Maritime University, yards and ports are manifestation of the fact that in past three decades, the structure of global economy has undergone substantial changes in favour of emerging economies, with China topping the list. China is leading from the front by announcing setting up of Asian Infrastructure Investment Bank, along with other 20 Asian countries to help build trade related infra-structure.

The (NDB) new development Bank of BRICS and the AIIB, will provide fresh source of funding for developing economics, without depending on Bretton woods institution World Bank, which puts rigid conditions. AIIB may be seen as rival to Asian development Bank, dominated by developed world.

During my visit, I was briefed that China and Australia has signed Free trade Agreement (FTA) and Yuan Clearing Bank is to be opened in Sydney. China has also achieved first man made river from South to North at the cost of 81 Bill USD, to feed the water starved region

I, wondered as how China transformed so rapidly, but seeing is believing, as I found Shanghai Pudong financial District which was a farm land in 1980 as I, recall vividly has turned equally

as attractive as Manhattan and so in the bund area. Nanjing road can be bench marked to Time Square and Oxford Street.

Having, seen the transformation that too rapid, I, recalled comments of economic Nobel Laureate Joseph Stigletz in Vanity Fair magazine who says China enters to the top position in 2015 and will produce 17.6 Trillion GDP this year thus a new global political and economic order is emerging and the comments of Martin Jacques, a British journalist a well known pundit on Chinese issue, since publication of his 2009 book “China rules the world.” In a recent article published in Financial Times of Martin, he argued western view on China Governance as flawed. China’s governance system has been successful for more than three decades for transformation with remarkable achievements in all faculties, be it maritime, town planning, Electronics etc etc. He compliments achievement and praise the core of much wider change in Chinese society. I found Chinese attired in branded clothes and hard to see any traditional mind set in urban centre, thanks to the reforms of Deng Xiao Peng. The economy does not exist in isolation from society, it is not some thing one may change and everything else remains same.

The Chinese Governance system as I observed, may be complimented for absorbing 30 percent rural population in urban centers, creating modern education, health care, housing to  re-engineer and re purpose the state. My study reveals that there exists an extra ordinary relation-ship between State and Society, extremely long period of time say 2000 years. What I learnt from Chinese, that State is fundamental expression of what China is and what Chinese means, unlike west or other Asian countries governed by west minister sham democracy.

We, in Pakistan may learn from them, but I doubt it can be transplanted here, as the history and circumstances are different. The Chinese State is pretty unique institution, they only countries close to Chinese Governance system are other Confucian based societies. In the Sub-Continent Senskar/Parempara and religion plays a vital role thus hard to transplant Chinese Governance.

I, may mention U.S. political scientist Francis Fukuyama as he writes in his book “ POLITICAL ORDER AND POLITICAL DECAY” he believes that three  building blocks are imperative for well ordered society, a strong state, rule of law and democratic accountability, which we sadly miss all three in our land of pure. There is a growing recognition of serious governance problem in west, no solution is in sight nor west can escape stagnation. West continues to decline in global position, the ruling elite is unable to resolve as the case with us, whilst U.S. being more successful with shale revolution, but still do have problems. China is equally facing challenges now, due to transition from very labour intensive period of growth, to less rapid growth with technology based and consumer based economy, it may be difficult transition too. Hope Chinese Government strikes right balance. I found my study tour from universities to urban centre very educational in November 2014.

I, was fortunate enough to tour India in December 2014, also an emerging country like China being engine of worlds’ growth for past couple of decades. Indian economy has grown from 46 bill USD import/export in 91/92 to 756 Bill USD Import/Export in 2014, however 91/92 had

trade deficit of 6 Bill USD, where as today it has swelled to 136 Bill USD . The Metro at Calcutta and Delhi are operational and well maintained, but slow in speed when bench marked to Hong Kong and Shanghai. Shanghai caters to 30 mill people, however the Metro is managed by a Hong Kong Company. Shanghai has magnetic levitation train speeding to 413 km from Pudong airport to Shanghai city about 30 miles away, time to travel is only 7 minutes.  I, learnt from consultants in India that Government has given consultancy to Chinese for Bullet trains to improve logistics in India. India have 133000 miles of Railway track of colonial days catering to 23 million passengers and only 2.6 million tons freight. Indian Railway needs renovation/investment as 93% of income is spent on operations only. India is seeking 93 bill USD in their 5 year plan to replace 25% century old bridges and track, thus looking to Chinese assistance to transform

Indians are building highways too, but way behind China, as they lack quality and international standards. Indian’s budget 2014 announced by Finance Minister Arun Jaittey gave a booster dose to maritime sector too.

The Ports and Shipping policy has set ambitions plans but sad to note that 12 major Indian Ports along-with 85 other ports handle total 7 million TEUS, whilst only Shenzhen in China handles 10 mill TEUS, whilst Shanghai is the leading container handling port leaving Hong Kong and Singapore way behind. Despite, dedicated efforts Indian Ports can’t handle E, EEE class container vessels, thus Colombo South port on the main East and West route is benefitted, handling Indian import/export, as regional hub . India has miserably failed to make any of its Port as regional hub, as like Karachi Port Qasim, all Indian Ports are feedering, the reason being no deep draft ports to cater new generation vessel exceeding 10000 TEUS    

Indian Government is committed to bring down its logistic cost, thus developing more inland water ways the cheapest mode of transformation. The blue print of Ganges project of 4200 crore rupees is so impressive to cover 1620 kms from Allahabad the confluence of Ganga / Jamna to Haldia port near Calcutta. The Government of India plans to make it navigable and restrict 50 major cities to drain 2.7 billion liters of solid waste into Ganges, by constructing concrete walls on both banks of Ganges. India is developing Metro in other cities, which may be completed in 5 years. If Chinese built the bullet trains ,  India’s logistic will be considerably improved. Whilst summing up at Delhi, I concluded that China’s neighbors are at least one century behind, because China has strong government, whilst we follow defective sham west minister democracy, which is not working even well for Britain. Indians are trying hard by allocating 5000 crore rupees to develop scientific ware housing infrastructure to improve the shelf life of agriculture, enable improve farmer’s revenue.

Having worked for the Government, I, presume in developing countries, most of which were under colonial rule for long period of time, the relation between Government / Ministers and Civil servants is not well defined or understood. Lack of documented procedures and Government guidelines are to blame. If a minister is corrupt, he tries to involve civil servants without written orders, and poor civil servants submit due to fear of loosing jobs. This is how

state machinery are used for party political gains, the situation in sub continent is same, thus unless we get out of quagmire the progress will never be rapid as China.

I, feel that Karachi deep water port convieved in 2006 to be completed in 2009 is still in limbo due to lack luster attitude of Karachi Port Trust, with serious impediment of dredging and logistic access to the newly built port. The rail connectivity seems to be only viable solution as KPT has scrapped its original  plan of bridge connecting to Manora and western break water cargo village connecting to Northern bye pass. Even Liayari Express way remains in doldrums due to connectivity on its north/south route of 5/6 milometer. Our new Port can be replicated like  Shenzhen if we take it seriously.

Let us ponder, as to how achieve transformation of our country by studying Chinese model and replicating development plans, instead of relying on the “MOU signed” mentality. Let us be pragmatic to transform our country by replicating the Chinese model of transformation. We must learn from all to keep improving.

This article was also published by PAKISTAN & GULF ECONOMIST  on 26-Jan-2015.
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Captain Anwar Shah
Maritime Adviser to President
Karachi Chamber of Commerce and Industry.
captshah1@hotmail.com