Gwadar shipyard to incentivize commercial shipbuilding and repair industry
By. Fatima Javed
Pakistan has recently finalized the details for the construction of a new shipyard in Gwadar. The project aims to encourage the commercial shipbuilding and repair industry, generate employment and spur economic growth.
Gwadar is a nearby place for the hub of global shipping lines which would offer better business opportunities, particularly for ship repair and maintenance. Gwadar shipyard would be the future state- of-the-art facility capable of repairing and building ships up to 600,000 DWT to cater to regional and global demands.
Allotment of 750 acres of land was approved last year by the Baluchistan cabinet for the construction of a shipyard in Pasni city of Gwadar district.
Recently, the country's federal and provincial governments announced a joint collaboration by signing a MOU for the establishment of the Gwadar shipyard, with the project expected to take at least two to three years after the completion of a feasibility study.
According to Zobaida Jalal, Pakistan’s Federal Minister for Defense Production, the project is strategically located in Gwadar, which is "of great regional importance" and also essential for the socio-economic development of Baluchistan and the country as a whole, as it will “create employment for the locals” and boost revenue generation.
Jalal also added that the Gwadar shipyard will be offering shipbuilding and repairing, as well as training facilities benefiting the whole region.
Baluchistan Chief Minister Jam Kamal Khan described the Gwadar Shipyard - a joint venture of the federal and Baluchistan government - as “a historic project” that would “usher the province in a new era of prosperity and economic development” with the creation of new jobs for the youth.
Shipbuilding is a capital intensive but generally termed as a nation building industry. This industry is dominated by China, South Korea and Japan mainly due to the right approach, cheaper wages and strong government backing.
Pakistan offers cheap labor compared to China. It is about 82% less i.e. approximately 0.59-0.81$ per hour compared to 3.32- 4.49$ per hour. But due to lack of opportunities in Pakistan, most of this workforce is employed in the Middle East.
This work force can be attracted to join the shipbuilding industry at home if favorable financial packages and opportunities are offered to them. Pakistan, despite having a few merchant ships in its inventory and almost total dependence on sea trade, has not taken any worthwhile measures previously to exploit the shipbuilding sector.
Considering the prospects under CPEC with a greater likelihood of quantum jump towards demand side, the development of a new state of the art facility area for Shipbuilding, Repair and Maintenance is quite significant at Gwadar Gateway, which will be the future hub of shipping-related activities.
