PAKISTAN STUDIES NOTES-GRADE 10TH

Chapter # 6 – Economic Development

6.3.4 Assess the Feasibility of Development of Gawadar Port and its Importance in the Economic Development of Pakistan.

Introduction

Gwadar Port, situated in the Balochistan province of Pakistan, is a deep-sea port that has been developed with financial support from China.

What are the factors that made the development of Gwadar Port feasible?

1. Geographical Location: Gwadar Port is strategically located at the mouth of the Persian Gulf, near the Strait of Hormuz. Its proximity to key shipping routes makes it a potential hub for trade between Central Asia, South Asia, the Middle East, and beyond.
2. Deep-sea Port: Gwadar has natural deep waters, which can accommodate large vessels. This makes it feasible for handling cargo ships, including oil tankers and container vessels.
3. Warm-Water Port:The Arabian Sea, being a warm-water body, remains ice-free throughout the year, unlike seas found near the poles. This characteristic facilitates uninterrupted international trade. Given Gwadar Port’s placement on the Arabian Sea, it ensures year-round operational functionality.
4. Clear Weather: Gwadar experiences consistently moderate and clear weather conditions throughout the year. This clarity and stability in weather are crucial for facilitating uninterrupted port activities.
5. Infrastructure Development: The development of port infrastructure, including terminals, berths, and handling facilities, is crucial for the port’s feasibility. Pakistan has invested significantly in developing Gwadar Port and its associated infrastructure, including road and rail networks connecting Gwadar to the rest of the country and neighboring regions.
6. Security Considerations: Ensuring security and stability in the region is essential for the port’s feasibility. Pakistan has taken measures to address security concerns in the area to attract investment and facilitate trade through Gwadar Port.

Importance in Economic Development of Pakistan:

The economic significance of Gwadar Port extends not only to Pakistan but also to neighboring countries. Gwadar Port has the potential to be a transformative force, not just for Pakistan’s economy but for the global economy as a whole.

1. Development of Balochistan: Balochistan, the least developed province in Pakistan, stands to undergo significant development with the establishment of a fully operational port. The provincial government of Balochistan aims to generate revenue through various tax collection mechanisms. The generated revenue will be utilized by the government to accelerate economic activities and enhance the living standards of its populace.
2. Trade and Commerce: Gwadar Port has the potential to boost Pakistan’s trade and commerce by providing a shorter and more cost-effective route for goods coming from and destined for Central Asia, China, and the Middle East. This can lead to increased trade volumes and economic activity.
3. Revenue Generation: Gwadar Port will serve as a crucial link for China’s trade with the Middle East, Africa, Europe, and other global regions, fostering bi-directional trade opportunities. Additionally, landlocked nations such as Afghanistan and countries in Central Asia can leverage Gwadar Port for their international trade activities. Consequently, Pakistan stands to generate essential revenue through transit fees imposed on these countries. Moreover, Pakistan can levy charges on countries utilizing the warehouses established at the port. These warehouses offer foreign traders storage facilities for their goods, enabling them to transport their merchandise at a later time. Hence, this presents another avenue for revenue generation for Pakistan.
4. Employment Generation: The development of Gwadar Port and associated infrastructure projects has the potential to create employment opportunities, both directly and indirectly, for the local population and skilled workers from other regions.
5. Industrial and Economic Zones: The establishment of industrial and economic zones in the vicinity of Gwadar Port can attract investment, promote manufacturing activities, and stimulate economic growth. These zones can benefit from the port’s connectivity and logistics capabilities.
6. Alternative Port: Gwadar Port has the potential to serve as an alternative port to Karachi and Bin Qasim Port. Authorities can redirect ships towards Gwadar Port in the event of protests or natural disasters such as cyclones.
7. Energy Security: Gwadar Port can serve as an important gateway for energy imports, particularly oil and gas, reducing Pakistan’s dependence on existing ports and enhancing energy security.
8. Regional Connectivity: Gwadar Port is a key component of China-Pakistan Economic Corridor (CPEC), a flagship project of China’s Belt and Road Initiative (BRI). Its development strengthens Pakistan’s connectivity with China and other regional countries, fostering economic cooperation and integration.