The completion of National Trade Corridor (NTC), improvement of North-South network and the building of couple of new shipyards will help Pakistan to earn about $60 billion annually in transit trade.

Pakistan's Planning Commission has finalised a study according to which Pakistan will earn $60 billion annually. This estimate has been made by the planning commission that is seeking advisery services from international firms for establishment of two large size shipyards at Port Qasim and Gwadar Port on a fast track basis. The appointment of an adviser for preparation of project structure would lead to international competitive bidding to develop the shipyards and related infrastructure at an estimated cost of $500 million, to be raised through an emerging public-private partnership (PPP) facility. Official sources said the government aims to complete hiring process for advisery services before December this year. The government has already asked Karachi Shipyard & Engineering Works Limited (KSEW) to coordinate with reputable international financial institutions, investment banks having direct or partnership with technical, legal and other consultants to assist in planning, development and implementation of the project.

The private sector will be responsible for designing, financing, building, operating and maintaining the shipyards. The NTC - of which Gwadar port is an integral part - is a major communication link for Central Asian states, China and the Gulf as 60 per cent trade of oil and gas is done through this route. The government understands that it could play a major role in the region by reducing the transport time between China, Middle East, Central Asian States, Europe and Africa.The first project, Gwadar Shipyard will be set up at Gwadar East Bay (Shamba Ismail area), with approximately 500 acres of area. Starting with ship repairing, the facility will convert into ship building of up to Very Large Crude Carrier (VLCC) and Ultra large Crude Carrier (ULCC) size and will have at least two dry docks of approximately 600,000 DWT (dead weight).The second project, Port Qasim Shipyard is planned to be developed adjacent to Korangi Fish Harbour (Port Qasim Area), covering an area of approximately 500 acres with at least two dry docks of 600,000 DWT. Main function of this shipyard will be building of large ships up to VLCC/ULCC size and construction of offshore and onshore oil rigs. It will also have ship repair facilities.At a recent meeting presided over by President General Pervez Musharraf, it was decided to accord high priority to the ship building industry to make Pakistan as a leading shipbuilding player by taking advantage of its location and emerging opportunities in shipbuilding including engine and equipment manufacturing.The meeting had also constituted a high level policy board headed by the prime minister to provide policy initiatives for establishment and development of shipbuilding and marine industries in the country. The board was asked to facilitate the development of large shipyards at Port Qasim and Gwadar Port and to ensure acquisition of land and provision of all related infrastructure. The board comprised governors of Sindh and Balochistan, ministers for Ports & Shipping, Defence Production, Privatisation, adviser to the PM on finance, deputy chairman planning commission, chief of Naval Staff and secretaries of defence production and ports and shipping.Besides the existing incentives like exemption from customs duties and sales tax, the government plans to facilitate financing for Pakistani companies placing orders on Pakistani shipyards and facilitate setting up of allied and ancillary marine industries such as steel, paint, ropes, wire, cable, diesel engines, boilers, generators, air compressors, electric equipment, motors, winches, outboard engines, pumps, valves, hydraulic equip, fire fighting equipment steering gear etc.Currently, more than 80 per cent of Pakistani trade is carried by foreign ships as officially run Pakistan National Shipping Corporation (PNSC) manages a fleet of only 14 ships. Last year 3,000 ships visited KPT and PQA in Karachi area only but none of these ships could be provided ship repair services as, the only two small docks currently available fall much short of even domestic requirement. Domestic shortfall is estimated to be 69 docking months annually.