The important role of business community

Being an ex merchant marine captain and having weathered many storms during my sea career and also saw ebb and low tides as well as neaps (a tide of minimum amplitude when sun and moon are working against each other). I now see a lull before an economic cyclone. 

The storm which is brewing in the country due to downslide in economy and 32.5% CPI inflation of food commodity in June, falling exchange rates are serious concerns of business community as well as of masses at large. I was witness to a function of business community which was largely attended by notables of trade and industry in honour of the Head of State at local five star hotel. 

While I found the business community frank and vocal and expressed their serious apprehension on economic conditions, which is absolutely true as focus on trade and industry by the Government is not in sight nor the comprehension of the gravity of the situation. Nobody seemed to be alarmed with trade deficit exceeding 20 billion USD and loss of assets of billions of dollars in stock market and flight of funds from the country, closure of industries and increasing unemployment. We are virtually a banana republic like Honduras of the past where no good governance was visible and the mercenaries were active. 

The Head of state also endorsed the views of trade industry and received rousing reception. While reading "Abel Hermant" who said "if lies kill love, what does frankness do?" I could see perhaps for the first time all speakers being frank, but politicians soon learned that frankness is an expensive commodity in public life. The same is true in private life, except when it is judiciously employed and tempered by kindness, for frankness can do greater harm to fragile relationship resting on strings. 

The speakers spoke with frankness to reveal what they really think, to tell the truth as one sees it, and to do so whatever the consequences. When people are not frank they are being careful or dishonest, or tactful and often all three. Many of us find that dishonesty and tact are far more useful for getting on in life than frankness. This is regrettably true as regards dishonesty but not always so as regards tact, for tact is an impression of concerns for others needs and sensitivities, and is an important instrument in helping people negotiate the unpredictable complexities of relationship, which unfortunately our political leadership lacks. 

In my opinion, the only kind of person who can be frank is a saint. He says what he thinks, and even when it is uncomplimentary to his interlocutors, they sense that there is no malice. I am of the opinion that in frankness of trade and industry leaders there was no malice and a very good speech was by FPCCI member from Lahore, who did not mince words and spoke without malice. 

There are very few of us who can guarantee purity of our motives in speaking bluntly for the national cause, but politeness acquires a great value, as was evident from a soft spoken leader. 

I have observed that in every social transactions most of us are consciously or otherwise assessing how much frankness the circumstances demand. In my interaction with electronic media, I always quoted the axiom of Tennesse Williams that all cruel people describe themselves as paragons of frankness, thus continuous bashing creates sympathy which was largely evident giving the impression that the tide is changing from the ebb to flood. Thus musketeers on TV shows may draw lessons and try to contain bashing as it is libellous/slander. 

It will not be out of place to draw moral of Muslim bashing by US and to my shock, I have seen recently more Hijabs and reverting to religion in Istanbul as in the 90s it was hard to find people in the blue mosque which is now jam packed. Therefore continuous bashing brings sympathy. 

There are many areas where frankness is almost invariably imperative, national interest, the evolution of friendship. The point at which friends can drop their reserves and reveal themselves to each other is the point at which their relationship advances to a higher level. One frankness invites a reciprocal frankness. Unfortunately even in the case of national interest or that in the case of friendship our ruling coalition is not frank to each others on issues, thus the country is in a limbo, looking for a saviour. 

The nation is virtually rudderless and is drifting to be grounded. It could be anybody's wild guess who is actually at the helm of affairs of this commandless ship of Pakistan, which in nautical terms means "out of command," sending "SOS". 

It is now incumbent upon all to put their heads together voluntarily to address the economic issues on priority as rising food inflation of 32.5% and transport and communication of CPI soaring to 25% as per FBS is serious cause of concern. 

We must cut down on fuel and food imports and learn to live within our means or find alternatives on war footings rather than blaming each other. The need of the hour is to take strategic decisions with honesty of purpose to salvage the country. 

The origin of the connotation of 100 days, hopefully, is not from sad Napolionic era of 1815, but hopefully after cleansing of connotation by Theodore Roselt of 1933, when in only 100 days the cabinet met twice a week and 15 Laws were passed. We may also draw moral from the biography of John F. Kennedy who on taking over said that I will not even commit 1000 days for the existing problems. 

Budget 2008-09 and maritime industry

Budget 08/09 is an ambitious document in the current chaotic international environment where fuel oil prices may surge to 150 USD and 200 USD by the end of the year. There can't be any dispute on the size and targets of growth, but due to rising commodity prices, freight hikes on import and double digit inflation, there appears a lot to be done in a little time because of international trends. 

Finance Minister seems oblivious to the economy's revenue generating ability and additional revenue generation upto 25% in 12 months, which is unprecedented. The chartering rates of vessels due to oil prices, supply and demand are high and 20 foot container costs 800 USD to Dubai comparing 2007 when it was only 300 USD. 

The country pays about 2.5 billion USD and now is expected to pay 3.0 billion USD in view of freight hikes, but unfortunately no relief or any provision has been made towards maritime sector, in particular ship owning under Pak flag, which has only 14 old ships and the beneficiaries are foreign flag vessels, dictating our trade and making our export/import expensive and incompetitive due to non-existence of sizeable tonnage under our own flag. 

It is not only maritime sector but textile apparel sector, a foreign exchange earner is also ignored. It was intriguing to note that the Finance Minister was made to state that in maritime sector dredger import will be custom free. It is already exempted from custom duty vide S,R.O. 457(1)/2004 dated 12th June, 2004, S.No 95 exempting ships, tugs dredgers etc under Pak flag up to year 2020 at rate of duty 0% advalorem. This appeared to be a gimmickry to say that maritime sector has been focused and addressed in the current budget. 

If I presume that SRO of 2004 is now being made part of the finance bill, it is unbelievable that a realisation has dawned after a lapse of 4 years. However a fear does exist that the move may also include foreign dredgers who come on project basis for short duration of 6/12 months and may also be exempted from payment of custom duty. 

If the latter is true then we will be killing our nascent dredger industry which has brought investment under Pak flag both in public and private sector and transfer of technology and employment to Pakistanis on dredgers, tugs etc. I sincerely hope that my presumption is not correct, we have to await for details, but we must express our fears and resist any move to kill the new dredging industry under Pak flag. 

KPT and Private sector both have invested heavily in this sector. It is said that more than 50 mill USD have been invested and Pakistani human resource have been trained abroad to undertake dredging of harbours etc. 

Port Qasim pays to foreign dredging companies for dredging annually 1 billion rupees for a Bill of Quantity of 5 million cu. meter silt removal to maintain 11.0 meter draft. The channel is to be dredged to 14.0 meter as per new agreement with D P World at a cost of 140 million USD and after dredging, 10 million cu. meter silt will have to be removed annually at the cost of Rs 3 billion annually. The present cost of trailer suction dredging is 5 USD per cu. meter and cutter suction dredging is 20 USD per cu. meter. 

DPW has been constituted for 140 million USD dredging of Port Qasim by the Ministry. Our nascent dredging industry needs to be protected from foreign giants in this industry. 

I would rate this industry growing well under Pak Flag and it is an excellent example of public and private sector competing under the same flag with no preferences . In addition to Port Qasim, Gwadar Port is going for 1 million cu. meter dredging and government will ensure that Pak flag will be given preference as Port Qasim Board unanimously resolved to give preference to Pak flag vide agenda item 34 of 91st board meeting. Preference to national flag is a must. 

KPT has been awarded work to dredge Pasni Fish Harbour so the users are not only ports but KESC, Pak Navy, refineries and DHA etc, and a lot of foreign exchange is paid to foreign companies for dredging work. The fleet is building up well and KPT has acquired state of art dredgers so is the private sector. 

THE PRESENT STATUS OF DREDGING FLEET UNDER PAK FLAG IS AS UNDER: 

KPT - Public Sector: 

-- TSD Mahmoodul Hasan 2500 cu. meter. 

-- TSHD Abdul 6500 cu. meter 

-- CSD Karamat 

-- Back Hoe Ali 

-- Grab dredger Aminullah working at Pasni 

Private Sector: 

-- 3 CSD, Raffay, Shayan, Danayal 

-- 2 Grab dredgers - GHD Kamran and KT 

-- With allied equipment, tugs, barges etc. 

The fleet of dredger is growing equally in public and private sector with transfer of technology and training of Pakistani human resource, who are operating them efficiently. 

The government must support the nascent dredging industry under Pak flag, be it public or private sector and in all tenders provision be made to pay 15% extra on tender rate to Pak flag as incentive. This incentive is given by many countries to their national flag. 

The annual dredging cost may exceed 10 billion rupees when all users, including KPT, which undertakes its own dredging. I also propose similar incentives to tugs flying Pak flag and hiring of tugs of foreign flags be discouraged to build our own fleet of dredgers and tugs under Pak flag to save foreign exchange and generate employment of Pakistanis on their own fleet. 

The Finance Minister did mention development of Gwadar port out of logistics allocation of Rs 37 billion, but categorised maintenance and repair of Makran coastal highway which was completed in 2004. There is no indication or allocation for connecting Gwadar to Surab and Rotodero to connect national highway or commonly known as National Trade corridor. There is no allocation for expressway to be built from port to connect coastal highway by passing city settlements or rail road. This validates current statement of Minister of Ports and Shipping that Gwadar Port may be operative by 2011. 

These are my humble suggestions and I am confident that the Ministry will give due consideration for growth of Pak fleet. It is time to forget vested interests and national interest be considered foremost. (Nine Tenth of Wisdom consists in being wise in time) 

Keti Bunder: dredging cost and connectivity

The newly elected Prime Minister of Pakistan in his opening speech promised to give nation a new Port Keti Bunder along-with 100 days priority agenda. It is a welcome sign for all Pakistanis in particular for seafaring community and Maritime professionals. 

Port Qasim was also conceived in the 70's and it is likely to turn into Industrial Hub Port by 2020.Whilst, Port Qasim is helping the nation but it is seriously effected by silting due to be in the proximity of Indus Delta and South West Monsoon. The annual maintenance dredging cost runs into 1 billion rupees to maintain 11.0 meter draft. 

The plans are on way to deepen the port to 14 meter, costing about $140 million. Present annual dredging BOQ is 5 million cubic meter and when dredged further, it is estimated that annual maintenance dredging will be around 10 mill cu meter thus costing in excess of 2-3 billions rupees to maintain the desired depth. 

When Port Qasim was conceived ie returning to old medieval site of Indus River Port Dewal, which was conquered by Mohammad in Qasim ( A History of Indus by J.C. Powell, A Voyage on Indus by Alexander Burnes 1831). 

The initial planners and hydrographers at the time of conceiving the port faltered and could not rightly estimate the annual maintenance dredging quantum and cost which was far low comparing as of today's 5 per $ per cubic meter and cutter dredging cost of $20/- per cubic meter. 

Furthermore channel is 40 km with sharp bends restricting night navigation, when compared to Karachi and Gwadar of 3.5 km, where vessel can berth/sail 24/7/365. Time is money for ships and ship owners of today and economy of scale is the key to profitability, thus deep drafts are required. Non availability of night navigation for deep draft and long channels are considered as dis-advantage in port planning. 

It is presumed that planners of Keti Bunder must have studied the geological history of Indus Delta, coastal hydraulic survey, currents, littoral drift, hydraulic model studies, coastal geomorphology, Alexander Burnes surveys of river Indus and earthquake epic centre and geologic structure of indus basin whilst carrying out hydrographic survey, wave patterns, forming of breakers in monsoon and the coast being low and not discernable except at close quarters for the safety of navigation. 

Whilst referring to Indus Delta Map Keti bunder is approachable via Hajamaro creek, which runs beyond Ghora Bari. Since no hydrographic and other studies are available which were carried out in last decade, it could be any body's guess that how much dredging will be required to meet today's generation vessels of 14/16 meter draft and thereafter quantum of annual maintenance dredging to maintain the channel. 

It is presumed that a proper feasibility by competent hydragraphers and port consultants be carried out evaluating dredging and maintenance cost bearing in mind high cost at port Qasim. The other aspect to be borne in mind is excellent hinter land connectivity before port is built. 

We must learn from the experience of Gwadar Port, which is handicapped due to non existent hinterland connectivity. It is imperative that hard core professionals having experience of Port development may be engaged and this assignment of national importance may not be left at the mercy of generalist having no track of maritime faculty. 

We must also learn from the experience of dredging cost at Port Qasim and that of our neighbours ie India, Bangladesh and Thailand etc. The Hoogly river has silted Calcutta Port thus forcing development of new port of Haldia at the mouth of Hoogly, Bombay offshore port, Colombo south port, Chittagong offshore port at Juldia, so has been the case in Bangkok, where new Port has been developed at the mouth of the river to cater deep draft vessels of 4th and fifth generation. 

The next generation vessels are post panamax needing 16/18 meter depth and futuristic vision is Suezmax, Malaca Max of 21 meter, thus in all probability a site which is prone to heavy siltation being in Indus Delta costing billions in dredging and thereafter incurring annual maintenance dredging cost of billions, may only be considered after hydrographic surveys and financial feasibility to cater deep draft vessels of future. 

We, must have more ports to develop the region and to cater our futuristic needs. Port development is a science and all issues have to be addressed professionally to cater the futuristic development in the maritime industry. 

India has 12 major ports and 185 small ports and they are investing $15 billion in port sector and $12 Billions in developing quadruple triangle ie logistics connecting all major city's to cater 1 billion tons of Impo/Expo by 2010. 

It is a welcome announcement, however a proper latest feasibility be carried out bearing in mind that it may take 10 years to port be operational from the drawing board, thus ships calling after a decade and their specification be bench marked to make a success story for our future generation. 

Since a policy statement has been made thus same must be duly supported with credible latest studies, thus it is expected that the democratic government will make all plans public and will consider the views of local expertise available in selection of site. 

Needless to mention as per historical fact the Indus River had many ports in the past ie Patala, Debal, Lahori Bunder, Shah Bunder, Gharo, Keti Bunder, Vikar, Daragi and Bambhore, these ports were destroyed due to the ravages of Indus River or by the change of its course, thus we must learn from the history and a very scientific and cautious approach is recommended in selecting the site of new port. 

Meantime, we must concentrate to make new commercial port Gwadur fully operational and optimum utilisation of Karachi and Port Qasim. It is equally important to do traffic fore casting and our needs for 25/50 years. 

Global container terminal operators consolidate their position at Pakistani ports

Pakistani Ports ie Karachi has two container terminals viz, KICT (HPH) at West Wharf and PICT at East Wharves, whereas Port Qasim has DP world terminal QICT, and our third commercial Port Gwadur Terminal will be managed by PSAI, who are bringing two refurbished Gantries which were due mid January 08 by JHEN HUA a special Gantry carrier vessel. 

The Keamari Groyne deep water terminal also being awarded to HPH of Hong Kong has virtually made them key player as KICT is also owned by them and with completion of third phase KICT may be in position to handle 750/1 mill TEUS. 

Both Pakistani ports have handled 1.8 mill TEUS all captive cargo thanks to sustained economic growth and GDP 7% , however no efforts were made to secure CAS cargoes, which are largely routed through Bander Abbas (Iran) due to good logistics facility and marketing by Bander Abbas Port. 

Pakistani container terminal industry is largely controlled by HPH and DP world, whereas PICT is working hard to enter 0.5 mill TEU Club PICT is only Pakistani player. 

It is not only in Pakistan, but half of the world's terminal capacity, and almost 60% of through-put is managed by small group of companies, that can be defined as Global terminal operators a new name to stevedores of past Era. These companies having presence in more than one geographical region handled around 300 mill TEU an increase of 24.6% on the previous year. 

The buoyant world economy in particular strong containerised export growth in China and India helped global operators to grow organically. Most of the market leaders saw additional new capacity come on stream in 2004. It is expected that global terminal operators will increase their share from 57% in 2004 to 59% in 2010. 

Three out of four leading global operators HPH, PSA and DP are stevedore based together with Hydrid APM terminals, they handled about 150 mill TEU. The top four thus accounted for over half of the global terminal operator, through put and over 1/3rd of total world container terminal volumes. 

HPH is; the leading global terminal operator handling 47.8 mill TEUS, the company has strengthened its position in China, Thailand and Pakistan and Eastern Europe. HPH may achieve 72 mill TEU capacity by 2010. PSA, the second biggest operator has also experienced double digit growth. PSA is handling 40 mill TEU and planning to add 25 mill TEU by investing 4 bill USA in Singapore, Antwerp, Hong Kong and Gwadur. 

APM terminals have grown by 49% and likely to handle 61.6 mill TEU in 2010, by investing in India, China, USA, Brazil etc. CASCO the 5th biggest is striving for 4th position. Dubai port with acquisition is also trying hard to gain 4th position. It is assumed that new century will see a shift and carrier based terminal operators will play major role by 2010 with MSC, Hangin, Neddloyd, APM, CMA and CGM. 

The world container through-out is expected to increase by 9% upto 2010. HPH and PSA derive 70% of container business from S. Asia and Far East. By contrast APM, DPA/DPI have more balanced portfolio. The emerging new trends amongst global operators is to cooperate, as APH, CASCO and PSA are working together in Dalian Ports. 

By leveraging on various factors, including their generally greater financial resources, ability to spread risk, greater purchasing power, and ability to offer shipping lines a multi-regional network, the global operators have a competitive edgeover other private operators. There is also some data to suggest that they are more efficient. However, analysis of productivity data in terms of TEU per hectare and TEU per ship to shore gantry crane, reflects a slight detoriation in global terminal operator average performance in several regions. 

Most global operators showed a significant improvement in financial performance, thus HPH's / PSA profit margins were 30% + and PSA + DPI achieved a 15.5% return. 

TAILPEICE: Given the high entry cost and the requirement within most BOT and privatisation tenders that established international operators should only apply. The recent example that PICT could not qualify for Keamari Groyne deep water port, thus it may be food of thought for small private players who may have to succumbed to pressure of 4 leading operators, leading to acquisition of small players. The hybrid terminal operators like APM, Hanjin and MSC may be dictating in next 20 years and may cause problem to four leading global players too. 

There is a limited scope for new entrants to break into the global operators "CLUB" but china merchants and China Shipping container lines are the most likely future new comers. 

In Pakistani Ports HPH with KICT and Keamari Groyne deep ports will have the initial capacity of handling plus 2 mill TEU and QICT of DP world may handle 1 mill TEU by 2010. PICT a Pakistani company may find tough to face these two giants, so will be PSA at Gwadar will be at dis-advantage with monopoly of HPH at Karachi and DP at QICT. Gwadar has no hinterland connectivity other than Makran coastal highway to Karachi. 

The only solution is sustained economic growth of 7% plus to feed these captive cargo players. Pakistani ports will have to look for trans-shipment business to meet the need of increased capacity or else our economy may remain steady to support the development in Port and avoid surplus build up capacity. 

Some idealist without looking at patterns and data make claims of turning our ports as MEGA HUBS, it is hard to turn to REGIONAL HUB EVEN, as India having 6 mill TEU against ours of 1.8 mill TEU has not been able to turn its Pipavav port as regional hub, what to talk about mega hubs, a fantasy/fiction. 

The ground reality and the pattern of shipping trade data and geographical position can only give the correct picture, thus we must wake up to realities and not blazon on dreams. Let us learn from the experience of Colombo, Singapore and Jebel Ali etc which are professionally managed ports handling 70 to 75% trans-shipment cargo. 

12 Major Indian Ports are also thriving on captive cargo, however due to expected increase to 1 Billion ton mark of volume due to sustained economic growth of 9% plus. The Indians beaten by congestion and not allowing HPH to build Bombay gateway Port with J.V. of Larson Turbo on mere suspicion of China connection are now out to invest 15 Billion USD in ports and 12 Billion USD in developing rail tracks/roads to make quadruple triangle connecting all major cities of India. 

Colombo port has tendered South Port project of 2.4 mill TEU additional capacity, but HPH and PSA are vying hard and contesting, however as per latest report in world cargo news, Sri Lanka Port authority has awarded 400 mill USD project to HPH of Hong Kong creating a controversy that SPLA Chairman has misled the SPLA Board against joint venture of PSA and local Aticken spencer group. Bombay off shore deep water Port has also been awarded to Draravados of Spain and local partner Gammon India. 

Bandar Abbas thriving on CAS cargo has completed 2nd container Terminal at Shahid Rajai Port adding 1.5 mil TEU and boosting total capacity to 3.5 million tons. Port of Juibail is set to improve its capacity to 14 mil tons by June, 2008 from 11 mil tons. 

With above changing scenario, KPT has to be alert with its deep water Port project as now HPH may opt to concentrate on Colombo. It appears that Keamari Groyne project may suffer set back, unless pursued. KPT must go full speed ahead resolving issues, ensuring no cost escalation, as new developments do shift interest of terminal operators. Gwadar Port must also keep an eye on regional developments, thus GPA and PSAI has to offer incentives to induce ship-owners to Gwadar. 

Gwadar had been given on a clear note that PSAI will turn it as transshipment hub. All eyes are set since last 15 months to see the future of our new 3rd commercial port. One can only guess that Ministry of Ports and Shipping has taken due cognisance of changing scenario. 

The need for national port authority

Pakistan is blessed with three commercial ports - Karachi, Port Qasim and Gwadar. However there exists no national port plan or even national port authority to oversee the development of these ports. All the three ports are autonomous in nature and efforts to streamline have been blocked by the vested interests. 

These ports make their own development plans at times duplicating/complimenting each other. The last decade has seen technological improvements making imperative to plan the transportation system of the developing country as a whole, in order to achieve a balance between the capacities of the various ports. 

In maritime transport it is some time possible - particularly for bulk and unitised cargo movements - to include the shipping, port and inland transport facilities in one co-ordinated plan. In other cases the ship traffic is not under the control of planners and it is only possible to co-ordinate the port facilities with those of inland transport and distribution. 

Planning a seaport without considering the connecting road, rail and barge facilities may lead to serious fault in national communication. This is particularly true in case of developing countries in many of which the freight traffic is rapidly growing and changing. 

Port of Gwadar is a classic case of faulty planning as port was completed, whilst there exists no hinterland connectivity except coastal highway to Karachi, which too gets awashed with torrents and the passage of boze pass restricts trucks to carry heavy load and climbing due to difficult terrains. 

The port has been further dredged to 14 m depth but civil structure can accommodate vessels of max 50,000 DWT, not panamax vessels, another design fault. 

Due to the ignorance of planners Tugs/Pilot boats were ordered which are under power and not appropriate for tugging purposes as the design capacity of tug at max efficiency is 30 tons bollard pull and pilot boat is under power so is the cargo handling equipment. 

According to international IMO guidelines the port needs two 60 tons bollard pull tugs to swing the vessel in the designed turning basin of the port within 1.50 times of the length of the vessel. 

I have learnt from market sources that a panamax vessel is said to be due at Gwadar with 72000 tons cargo, thus I find it prudent to create awareness that the designed capacity is only 50,000 tons DWT, not 75000 tons DWT. Moreover the present tugs will not be able to handle a panamax. The searching question is that are we going for adventure or we are prepared for the consequences, this could be anybody's guess. 

Within the port sector a balance plan is needed for each class of maritime traffic. The number of ports, their specialisation and their locations have to be considered. 

We in Pakistan still permit competition between our ports, but this is no longer seen as acceptable norm where national resources are limited. The trend towards handling bulk commodities is specialised high, through puts terminals, where national traffic flow of a particular product may be handled at one terminal, irrespective of geographical requirements. 

If these terminals mushroom up in each port, they may remain under utilised and will not allow the country to take advantage of economy of scale, obtainable through usage of large bulk carriers. 

The specialised terminals can load/unload 10,000 tons per hour and freight for large bulk carriers are also low. Needless to mention that for all classes of freight, there is growing need to avoid over investment. Due to non-existent of national port plan, Karachi and Port Qasim both are offering bulk cargo terminals on BOT basis to entrepreneurs, a duplication which can lead to overinvestment and under utilisation as is the case of building new OP II whilst all white oil imports were shifted to Port Qasim due to Pepco line. 

Thus Karachi port handling liquid cargo capacity of about 5 millions tons have been shifted which is ultimate under utilisation, due to non connectivity to Pepco line from Karachi Port. KPT is competing with PQA to establish LPG and LNG terminals. The present installed capacity of oil terminals at Karachi and Port Qasim is about 33 mill tons, but only 18 mill tons is handled, thus underutilisation of capacity and if SBMS are allowed, then both ports will suffer further capacity loss. 

All the three ports in Pakistan submit their new projects to the newly formed Ministry of Ports and Shipping which is devoid of any port planners and projects are examined by the generalists having no track of maritime business. The amount of work involved in a country with several ports justifies the maintenance of a small permanent nucleus of professional planners, to be augmented by an additional professional team, when a full revision of national plan is needed. 

National port planning leads to several policy decisions to define the role of each port and usage of national resources in most economical manner. 

A further requirement would be which ports or the port infrastructure will be paid by Federal Government and which by individual port. It is strongly recommended that a national port authority be made to oversee the functioning of the ports. 

These recommendations fully or partly have been in practice even in our neighbouring country, thus there is strong case for setting up a specialist government agency with the overall responsibility for coordinating port policies at national level. 

To build up and maintain the capability needed, and to allow a free interchange of ideas with the many interests involved, it may be more appropriate for the agency to be separated from the central government ministry concerned and to take the form of a national ports authority with defined statutory powers, such as those listed below. 

There is a close parallel to the move in a number of countries towards national airport authorities, national oil authorities and so on. A small permanent secretariat would be appropriate. 

For efficient management of port activity, the operational decisions should be taken locally; it would normally be wrong to give a national ports authority any operational responsibilities. Its main function should be one of co-ordination and regulation, the principal aim being to prevent the undesirable duplication of investments. 

THE STATUTORY POWERS WHICH IT MAY BE APPROPRIATE TO GIVE A NATIONAL PORTS AUTHORITY ARE AS FOLLOWS: 

a) Investment: Power to approve proposals for port investments in amounts above a certain figure, for example, $5 million. 

The criterion for approval would be that the proposal was broadly in accordance with a national ports plan, which the authority would maintain. 

b) Financial policy: power to set common financial objectives for ports (for example, required return on investment defined on a common basis) with a common policy on what infrastructure will be funded centrally and what locally; advising the government on loan applications. 

c) Tariff policy: power to set a common tariff structure (local conditions will determine to what extent the authority should also regulate tariff levels.) 

d) Labour policy: power to set up common recruitment standards, a common wage structure and common qualifications for promotion; power to approve common labour union procedures. 

e) Licensing: where appropriate, power to establish principles for the licensing of port employers, agents, etc. 

f) Information and research: power to collect, collate, analyse and disseminate statistical information on port activity for general use, and to sponsor research into port matters as required. 

g) Legal: power to act as legal adviser to port authorities. 

It would be advisable for such an authority to set up a method of obtaining advice from persons with wide experience in the matters of harbours, shipping and inland transport, in industrial, commercial, financial and economic matters, in applied science and in the organisation of labour. 

An appropriate method would be to co-opt such persons on to the Board of the authority or on to its subsidiary committees. Liaison would also take place, with national bodies representing shippers, ship-owners etc. 

The risk involved in giving such an authority powers over port investments and tariff policy is that additional delays may occur. 

It would be essential, therefore, to institute in addition an emergency procedure to speed up or even bypass the normal decision process when, for example, there were sudden changes in traffic or rapid increases in congestion.

The only fear which creeps in mind, when suggesting pragmatic ideas is the appointment of right people at right places and strict adherence to laid down qualifications of commercial port management. 

'Fraudulent death licences' being issued by many maritime nations

Pakistan's Maritime Training and Examination system can be rightly proud of conducting examination of seafarers compatible to world class standards, thus Pakistani qualified officers are in great demand on foreign flag vessels and now even the most reputed Maersk Line is recruiting Pakistani officers due to their quality, diligence. 

Maritime community can keep its head up and face any competition for jobs. Pakistan has also qualified for the IMO white list and its renewal till 2010, as IMO auditors did find Pakistani training and examination systems compatible with developed world. 

A computerised record of all certificates issued is maintained and verification is promptly adhered too. Pakistani merchant marine officers enjoy a track record of zero accidents and no fraud licenses were ever issued. The period of 2003 to 2007 saw renewal of white list, signing of CLC-92, OPRC convention and being in the list of just 13 countries adhering to ISPS code made mandatory to solas convention. 

Pakistan also emerged in the list of first three countries to sign SID (Seaman identity document) convention of ILO C-185. Pakistani Seafarer have been issued machine readable SID and machine printed seafarers book. Pakistan is fully compliant to revised STCW convention. 

The image of Pakistan being tarnished by western media, could not document any record of Pakistani seafarer involved in any terrorist or fraudulent practices. This fact has been acknowledged by Secretary General of IMO in a letter to US authorities for not allowing shore leave to Pakistani merchant mariners sailing on foreign flag vessels. The IMO supported that Pakistani seafarers have clean record. 

I think we, Pakistanis, cause more damage to our image by calling their own country as failed state etc. I have yet to see a talk show or article where Pakistani media has highlighted the good role of Pakistani merchant mariners, our Ambassadors at High Seas on foreign flag vessels, as ship owning under Pak flag is insignificant. The leading maritime countries like Panama, Philippines, who earn billions of dollar were never publicised for issuing death licenses on mere payment of money. 

We must highlight our segment of society which has kept and is keeping Pakistani flag at top, despite remaining dormant in their own country. The crusades launched locally against merchant marine has forced skilled people to get recognition abroad. Commercial maritime experts were virtually chased out by their adversaries. Page 2 of 4 The ITF showed its concern, but the clout and support enjoyed by countries involved in fraudulent practices are ignored, however a slight mishap of Pakistanis are blown out of proportion. 

On the contrary Government of India has launched a "Maritime hand book" publicising the Indian merchant marine officers and their achievements. The Indian Government markets their seafarers, rather than impeding growth with beauracratic snags. Pakistani seafarers remit about 70 mill USD P.A and little effort is needed to train human resource potential of Pakistan and I am confident, if we have 50,000 seafarers the benefit to exchequer can be enhanced to 0.5 bill USD. 

I find it pertinent to elaborate such frauds, highlighted by IMO/ITF and SIRC. Fraud on massive scale: A report commissioned by the International Maritime Organisation, the United Nations agency responsible for regulating world shipping, has revealed that fraud is taking place on a massive scale. This is not just in Panama, where new revelations suggest systematic abuse of the certificate issuing process, but in many other countries too. 

The report, by the U.K. based Seafarers 'International Research Centre (SIRC) found 12,635 cases of forged certificates, as well as many incidents of laundering, where forgeries were used to obtain legal qualifications from authorities which failed to check the originals. 

The Panama Maritime authority has launched an inquiry into the Cockroft certificate fiasco while fending off a series of other attacks over its licensing, from SIRC and elsewhere. In the Philippines, for example, Panamanian consulate officials are alleged to have been complicit in delaying documentation so that a private company could charge would be Filipino seafarers thousands of dollars for a speedier permit-issuing service. 

David Cockroft General Secretary of ITF was issued certificate through a intermediary to a maritime official in Panama on payment of 4500 USD, without having been to a nautical college or seafaring experience. 

Around 6000 vessels are sailing under Panama's flag of convenience, a flag, like most other FOC's register vessel for profits with little consideration for safe, responsible shipping. Panama has sacked 14 of its licensing staff, and begun blaming international inspection companies for the scandals. 

Meanwhile the whole world shipping community has been thrown into a crisis of credibility. The certification scandal coincides on the one hand with publicity over the devastating findings of the international Commission on Shipping and on the other with the IMO's creation of a "While list" of flag states deemed responsible enough to issue seafaring certificates. Panama is one of 71 countries endorsed by the list. 

Page 3 of 4 The SIRC report gathered feedback from 54 maritime administration, 39 percent of which said they had detected forged certificates and endorsements. More information came from 35 employers and 1,105 seafarers from six countries in south and south-east Asia and eastern Europe. 

Nine percent of the seafarers admitted using fraudulent certificates, with officers and ratings equally likely to have counterfeit papers. Meanwhile 17 percent had knowingly sailed with other seafarers who were using fraudulently obtained certificates. Around 85 percent of the employers had detected fraud in the last five years. 

SIRC believes these results indicate that around 40,500 people from the countries represented are sailing illegally. Counterfeit papers appear to be particularly prevalent among officers, war but the motivation for using them varies widely. Short cuts to a job at sea: Many seafarers are keen to start earning money at sea without first undergoing training, others to obtain a fast promotion. Some wish to hide details of their health or age, which might impede their chances in the job market. 

When it comes to security checks, watermarks or lamination are often seen as reassurance enough, but these do not address the problem of certificates that may be issued fraudulently by maritime authorities. Some administrations verify no more than five percent of certificates issued overseas, and in any case they are unsure what signs of authenticity to look for. Others ignore the problem altogether. 

SIRC has recommended the introduction of stronger anti fraud techniques, more funding for training and the provision of enhanced career opportunities for seafarers. 

But who will invest in better training or security in a largely unpoliced market where corruption brings cheap labour and high profit margins? The IMO is the only industrywise international regulatory authority. Yet critics say its hands are tied by a funding system under which 158 member states pay according to the size of their fleets. 

With the biggest fleet in the world, Panama pays over 15 percent of the IMO's annual budget. IMO is virtually dominated by groups and the clout of groups ensure milder actions without publicity. However in case of country like Pakistan, Bangladesh, Sri Lanka who have no clout at all, the risks are far greater for penal action and publicity. 

The recent incident of holding Greek and Philippine crew of Tasman Spirit at Karachi for enquiry only, brought the Secretary General of IMO to Pakistan to ensure their release without guarantee of any compensation for pollution from the Greek Owners of Malta registered vessel. 

I feel that SARC countries and other Asian countries must join hands in IMO to have some clout in IMO so that interest of developing countries can be protected. I think this may be a food for thought for Ministry of Foreign Affairs and Ministry of Ports and Shipping and Directorate General of Ports and Shipping an extension of Ministry and focal point of IMO. 

All countries have permanent representatives posted at IMO eg Iran, India, Bangladesh, Saudi Arabia in addition to major maritime nations. They ensure to protect their country's maritime interest being fully conversant with constitution of IMO, professionally, academically, qualified in maritime filed, being well conversant with working of MSC, MEPC, TCC, committee and at times chairing sessions where rules are framed and made obligatory for all maritime nations. 

Pakistan definitely needs to be represented permanently in all meetings a full time assignment, thus calling for appointment of a permanent representative who should be highly qualified maritime professional having experience of working of IMO. I, reluctantly propose fearing some incompetent generalist may fill this slot by pulling strings, unlike Iran, India, Saudi Arabia and major maritime countries where merit and international exposure is criteria for such appointments. 

What I fear is voluntary audit scheme will be enforced by IMO and countries not represented will be targeted, thus throwing about 20,000 Pakistani seafarers jobless, although being competent, but having no clout in regulatory maritime regime ie. 

IMO It is necessary to appoint skilled officers in maritime training and examination system in Pakistan as most of the officers have retired or will be retiring before VAS is enforced in 2010. Let us at last rise above the personal and vested interest for the sake of our country's credibility.