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Development of dry ports.

Multimodal transport is gradually replacing traditional transport and trading methods, also in Pakistan, although it would be an exaggeration to say that Pakistan is a frontline state in this respect. There is however a growing awareness of the advantages of updating trade and transport technology. This involves not only a revision of legislation, procedures and documentation but also rehabilitation and modernization of the infrastructure, the equipment and the organization of transport operations.

The Multimodal Transport & Trade Facilitation Programme is tackling this subject since mid 1992 with the active and enthusiastic participation of more than one hundred people engaged in trade and transport, from the public as well as the private sector. Many of them are today in this audience.

Without under-estimating the importance of institutional reforms that are required I will presently only deal with the physical and organizational aspects of our Programme.

The development of multimodal transport in Pakistan will have a tremendous impact on the future role of the ports. The traditional port activities such as cargo handling, storage, customs clearance, sorting and distribution or collection of cargo will gradually shift to off-port locations close to the areas of production and consumption. The ports will become pure transfer points between land and sea transport and, relieved from most of the time and space consuming traditional functions, their throughput capacities will vastly increase. This process requires a parallel reorganization and modernization of the seaports, of the inland dry ports, and of the connecting inland transport. Very little has happened as yet in Pakistan in this respect.

Karachi handles about half a million container units per year and of these about 300,000 are from or for inland origins/destinations. Contrary to all logic and economic principles 90% of these containers are stuffed and stripped in the port area and their contents are transported inland as conventional break-bulk cargoes. This practice severely limits the throughput capacity of the port and prevents it from efficiently coping with the increasing cargo volumes. Karachi's East Wharf, as it is presently operated, has a dry cargo throughput capacity of not more than about five million tons per year. However, if properly planned and operated this capacity could increase to up to twenty million tons of containerized cargo per year, which is the forecasted container throughput in about twenty years time.

This requires proper long term planning and zoning Plans for Karachi, with concentration of all future container activities on the East Wharf. This will leave the West Wharf for the handling of the remaining conventional and semi-bulk cargoes and the Keamari area for the handling of the oil cargoes.

Unfortunately KPT has different ideas about this and in a newspaper notice ten days ago has invited expressions of interest from the private sector for the development of container terminals at various locations scattered all over the port, namely berths 1-4, berths 14-17 and berths 22-24. If this would be allowed to happen it would abort any plans for an efficient organization of the inland transportation of the containers under the multimodal transport concept.

It should also be noted in this respect that berths 1-4 on East Wharf and berths 22-24 on West Wharf, proposed by KPT for conversion to container terminals, are totally unsuitable for this purpose as there is not enough space available behind the berths. For modern container terminals at least 300 meter is required behind the quay, which is in Karachi only available behind berths 5 to 17 of the East Wharf.

However, KPT is effectively blocking any future expansion of the container terminal development which is taking place on berths 14 to 17 in that area by declaring berth 13 as a berth for KPT's own operations, whatever these may be, and by dedicating berths 5 to 12 for multi-purpose operations. It is imperative that a serious long term plan, including proper zoning, should be made for future port development. Pakistan handles presently about half a million maritime container units, on average about 1400 per day. At least half of this number is for inland destinations or from inland origins, which would be sufficient to fill 5 container trains Northbound and 5 container trains Southbound each day. In fact however there is not more than one container train departure every second day.

The main causes of this retarded development of modern and efficient transport methods are the lack of appropriate facilities in the sea-port and dry-ports and the lack of sufficient and appropriate equipment for the land transport of the containers. As regards the problems of the sea-port facilities these can be solved by dedication the East Wharf of Karachi Port for the development of container terminals.

Pakistan has presently 8 dry-ports of which Lahore is by far the most important. The others are Peshawar, Rawalpindi, Sialkot, Faisalabad, Multan, Quetta and Hyderabad.

Lahore Dry Port, with more than 85% of Pakistan's dry port throughput, was established in 1974 in the existing railway goods depot. It is located in a congested area close to the city centre, with narrow access road. The general lay-out is not suitable for the handling of container trains. The throughput is 15/20,000 TEUs per year and there is little scope to increase this throughput capacity of the present Lahore Dry Port in view of the inherent constraints.

The present dry port could continue in future to handle the conventional break-bulk cargoes in bond but for the container cargoes other arrangements should be made at locations outside the city area, either North or South of Lahore, or both, which are rail and road connected. It is not necessary that the dry port should be owned or operated by P.R.; in fact in view of the financial constraints of P.R. there is scope for private sector involvement in this field.

These dry-ports should be equipped with rail gantry cranes which can give a container train a turn-round time of 6 to 8 hours and thus enable these trains to make a complete roundtrips Karachi - Lahore - Karachi in four days. The rail-head operations of the dry-ports should be next to, but completely separate, from the actual customs clearance and container freight station operations.

In about twenty years there will be up to a million container units under bond moving between the sea-ports and the dry-ports. In view of the large distances involved these could be most economically be transported by rail. This would mean that by that time about 12 container trains would travel per day in both directions. To cope with such traffic would require about 60 locomotives and 2,100 container rail wagons.

It is unlikely that Pakistan Railways, due to financial constraints, would have the means to undertake this transport and they would probably be willing to make contracts with private sector operators of container trains for the use of the P.R. rail-track. This would avoid the enormous cost of new rail track investment and would create additional income for Pakistan Railways.

For a start, in order to be able to give a daily, departure in both directions, a container rail company would require for its operations 5 locomotives and 180 container rail wagons, a total investment of about 25 to 30 million US dollars. If 4-day roundtrips can be achieved this would seem to be an economical proposition.

Pakistan Railways would have to guarantee transit time for the container trains of 24 to 30 hours between Karachi and Lahore. This would require double-tracking by Pakistan Railways of about 350 km missing link on this route but this is something which will have to be done anyway.

Also the road transport will have to be geared to the carriage of containers. Proposals are presently being considered to license private sector road haulers for the transport of containers under bond which at this moment is restricted to NLC.

All these matters mentioned here are based on an active participation of the private sector in sea-port operations, in dry-port operations and in the connecting land transport operations. The Government of Pakistan is very much interested in such participation by the private sector and has indicated all possible support.

In short, the actions to be taken for the promotion of multimodal transport and trade facilitation are:

* revision of national procedures and legislation to facilitate trade and transport.

* streamlining of national transport operations.

* development of awareness among the various local parties involved in international trade and transport of the importance of technological up-dating of trading and transport methods.

All the above points are being studied and discussed in the working groups of the multimodal transport and trade facilitation programme. We are confident of being able to contribute to these new developments within the next two years with proposals for realistic solutions for most of the problems and to assist in the actual implementation of some of these solutions.
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Title Annotation:Special Section: Industrial Policy and Planning; Pakistan
Author:Osmers, Ralph D.
Publication:Economic Review
Date:Jun 1, 1993
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