CPEC & AMAN 2023 and Prospects of Pakistan’s Blue Economy | By Dr Mehmood

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CPEC & AMAN 2023 and Prospects of Pakistan’s Blue Economy

China-Pakistan Economic Corridor (CPEC) has become an important “pillar” of the country’s socio-economic development and sustainability. CPEC Phase-II has been initiated in the country under which hopefully new heights of “progress”, “prosperity” and “productivity” will be achieved.

CPEC has already connected our “lands” and “seas”. The construction of Gwadar port has become the “jewel” of the blue economy in the country. Conversely, AMAN 2023 has also further strengthened prospects of the development of the blue economy in the country. In this regard, AMAN 2023 will be held on February 8, 2023 in Karachi.

It has the main theme of peace and hopefully it will facilitate a high pace of peace, prosperity and production at Gwadar seaport. It will host more than 40-45 countries under the flagship of AMAN-2023. It will further strengthen the Pakistan Navy’s abilities to develop a blue economy in the deep waters by having and securing the freedom of the seas.

Moreover, AMAN naval exercises have further enhanced capacity building systems of the country and the region such as piracy, smuggling, stowage and illegal immigration, safeguarding ships in conflicted waters, terrorist attacks and last but not the least, environmental disasters. Additionally, Pakistan has substantial stakes in the maritime domain. Pakistan’s interest in safer and crime-free seas is based on three realities i.e. extraordinary dependence on the seas for trade, making the CPEC project operational and strategic location astride the global energy highway. Thus AMAN 2023 has become an important “organ” of “national maritime stability”, “facilitator” of the blue economy and of course national security.

The Pakistan Navy (PN) is responsible to defend CPEC, easy and smooth Sea Lanes of Communication open and protection of Pakistan’s Coast Areas as well as the ports of Karachi, Bin-Qasim, Ormara and Gwadar.

The Task Force-88 (TF-88) is now taking care of the seaward security of Gwadar Port and protection of Associated Sea Lanes against both conventional and non-traditional threats. It comprises 400 marines, who specialize in defending marine assets/projects both on-shore and seaward against threats emanating from sub-surface, surface and aerial. It has been equipped with suitable platforms comprising gunboats, frigates, Fast Attack Craft (FTC), aircraft and drones as well as other electronic surveillance means. Most recently, the Gwadar port started receiving government imports of bulk cargo as three vessels carrying 90,000MT urea arrived at the port and clocked the fastest discharge rate.

The Trading Corporation of Pakistan (TCP), on behalf of the government, decided to handle the import of urea and wheat through the strategically significant port. The decision to use Gwadar port will ease congestion at other ports. High traffic of vessels carrying bulk cargoes delay operations and transportation of shipments, which in turn disturbs the entire supply chain mechanism.

After the bulk cargoes were discharged, they were bagged at the port and are being transported from Gwadar to other destinations in Pakistan. From next month, the port is expected to start handling 450,000 MT of wheat, said a press release. Cargo ships docking at the port also offer substantial benefits to locals living in the nearby cities as they help generate economic activity and open employment opportunities.

Gwadar Port offers substantial economic benefits to importers in terms of efficient operations, advanced cargo handling, vast storage facilities, extensive ancillary facilities, and faster turnaround. Its unique geographical position makes it a fast-economical link between some of the land-locked Central Asian States.

Gwadar Port is also formally handling and processing 45000 metric tons of wheat imports as the official agreement between the Trading Corporation of Pakistan (TCP) and Gwadar International Terminal Limited (GITL) has been inked opening a new chapter of logistic activities. As per the agreement the formal processing timeframe will be between 1st February 2023 to 31st March 2023.

To conclude, oceans/seas are a great ‘unifier” that link up all the countries and AMAN 2023 stands for greater maritime connectivity in the region and beyond. According to OECD (2022) it has a globe value of $1.5 trillion yearly which may be increased up to $3 trillion by 2030.

The Indian Ocean Region (IOR) has become the most significant international marine route which links Europe and the Far East. The regional blue economy is being carried out across the South China Sea, Strait of Malacca, Indian Ocean, Red Sea, Suez Canal and Mediterranean until the Atlantic. Moreover, the nautical pathways of its ocean are essential for the easy and smooth supplies of energy and food. Nearly 40 percent of the world’s energy is carried out through its waterways from the Persian Gulf to Europe and Asia.

Undoubtedly, the blue economy emphasizes on harnessing ocean resources sustainably to generate employment, boost livelihoods, and spur economic growth while maintaining the health of the ocean ecosystem. Pakistan, a maritime developing country, has endorsed and incorporated the SDGs into its national development plans.

The IOR is bordered to the north by Iran, Pakistan, India, and Bangladesh; to the east by the Malay Peninsula; to the south by the Southern Ocean; and to the west by Africa and the Arabian Peninsula and AMAN 2023 has become “connecting hub” of regional navies, maritime security, peace diplomacy and originator of blue economy in the region.

Many regional multilateral organizations including SAARC, APEC, the East Asia Summit, and the Indian Ocean Rim Association, are working to create supportive strategies and action plans for the sustainable development of marine resources/blue economy. China has already initiated its mega project of the BRI which is achieving wonders in National Marine Economies, which regularly assesses the development of several marine industries. Hopefully, CPEC & AMAN 2023 will further boost the blue economy in the country.

Pakistan has ports in Karachi, Qasim and Gwadar. It is a prominent coastal state in the middle of the IOR conducts more than 95 percent of its trade by sea. In addition, Pakistan makes the most of its 290 000 sq km Exclusive Economic Zone and Continental Shelf for a variety of activities such as fishing, mining, exploration, and marine research. According to national data (2021-2022), almost 15 million barrels of crude oil are being transported from the Gulf States to Pakistan via the Persian Gulf. Pakistan provides the quickest maritime access to China, Afghanistan, and the Central Asian States. This emphasizes the geo-strategic and geo-military significance of Pakistan as well as the potential of its maritime economy which would be further developed after AMAN 2023.

The policy makers are trying to develop Baluchistan under the flagship project of CPEC-I & CPEC Phase-II through Gwadar Port. The western coast of Pakistan is crucial from a strategic perspective because of sea lines of communications making their way from the Gulf of Aden and the Persian Gulf nearing Gwadar, Karachi, and beyond. Pakistan’s current maritime revenue projection stands at 183 million dollars which is far less than that of Bangladesh and India but can be further increased through the active role of Pakistan Navy and AMAN 2023 in the days to come.

Fortunately, the government of Pakistan declared 2020 as the year of the blue economy. It has also further reformed the Merchant Marine Policy of 2021 which provides a broad array of financial incentives to private investors, including the right of first berthing for carriers, a margin tonnage tax, the approval of freight rates in Pakistani rupees instead of US dollars, and a long-term loan facility.

Under CPEC and a series of AMAN naval exercises, Pakistan can develop its biodiversity-based tourism opportunities and can also explore eco-tourism in the coastal belt of Pakistan. Moreover, the fishery business has an untapped export market for seafood worth $US 2 billion which can be further developed.

The policy makers should also focus on the development of Maritime Autonomous Surface Ships (MASS) so that through integrated maritime policies the development of the blue economy would be achieved in the days to come.