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An Overview of Gwadar Port: Why is it so Important?

Gwadar Port

Gwadar is a port city located on the southwestern coast of the Balochistan province of Pakistan. The city is located on the shore of Arabian Sea and is about 700Km away from Karachi. Located near the border of Iran the Gwadar city is located to the east of the Persian Gulf and right opposite to Oman.

A Quick History of Gwadar:

Form the history, the Gwadar was a small to medium size setting with the economy mainly based on the artisanal fishing. The strategic value of Gwadar was initially appreciated in 1954 when it was identified as a suitable deep water seaport by the geological survey conducted by the United States of America. That survey was conducted on the request of Pakistan. At that time the Gwadar was under possession of Oman.

Despite having the idea of the value of Gwadar, its actual potential remained unveiled up till 2001. By the year 2001, initial construction of the Gwadar Port was initiated. With a net cost of $248 million, the first phase was inaugurated by General Pervez Musharraf.

After construction, the port remained under-utilized for a number of reasons including insufficient investment, security issues and the failure of the Pakistani Government to transfer land as per promised to the port of Singapore Authority (they were the port operators that time).

The CPEC Project:

By the year 2015, China showed its intention of developing Gwadar port city with an investment of $46 billion under the name of CPEC (China- Pakistan Economic Corridor). China aimed to develop a One Belt- One Road with the idea to facilitate the trading activities using this road. The Gwadar is majorly featured in the CPEC project. It is also foreseen as a link between the Maritime Silk Road and the One-Belt, One Road project.

Investments in Gwadar:

Almost $ 1.153 billion worth infrastructure is planned to be invested in the Gwadar city, apart from the major CPEC projects. The aim of this initiative is to link Western China with the Northern Pakistan to this deepwater seaport. The Gwadar city will also be a site for storing transported floating liquefied natural gas that will be a part of the Iran-Pakistan Gas Pipeline Project.

Importance of Gwadar Port:

With the changing time, the sea politics is getting complex with the massive involvement of economic prosperity and commercial activities, on a global level. The Gwadar port holds huge economic and strategic significance for Pakistan and is the third important seaport of Pakistan after the Karachi and Qasim Port.

Being located at the cross junction of the international shipping and the oil trading routes, the Gwadar port has become of massive global advantage for all the economies of the world, including Pakistan. This is the reason why Gwadar is considered to be acting as a trade hub in Pakistan. with its direct link to three major regions of the globe stated as; South Asia, Middle East and Central Asia, the Gwadar port will be a new investment opportunity that will have a positive impact on therewith of Balochistan.

With Gwadar, Pakistan will be able to explore minerals, gas and oil resources and hydrocarbons etc. the port is also attracting a massive amount of tourist and foreign investors and can be seen serving as a foreign reserve and free trade zone. All these features will surely help and play role in the prosperity of Pakistan. It can also help to enhance the commercial and trade activities in the country.

At the same time, it is believed that the Gwadar will make Pakistan be a monitoring part of the Sea Line of Communications that comes from the Persian Gulf. With a strategic leveraging of investments and opportunities, the Gwadar will open up doors for new opportunities of the people of Pakistan and will help them in their economic growth and stability via Trans trading activities and foregone exchange reserves.

Gwadar is also believed to be boosting up the co-operation of Pakistan with other political establishments of the world in terms of energy and oil resources. At the same time the trade, hotel industry, and the state revenue sectors will have a positive impact. As the Gwadar is offering tax-free trade and investment opportunities, it is successfully attractive for foreign investors to open up and invest in pipeline projects and economic plans.

The Geo-Political Importance of Gwadar:

The Gwadar port has massive strategic importance and is increasing the importance and value of Pakistan in a global setting and specifically in the region. Through the Persian Gulf and the Indian Oceans and Southeast Asia, the Role of Pakistan is enhanced. With its close locality to the Strait of Hormuz, it will be a roadway to supply 13 million barrel oil on daily basis.

Gateway to Central and Southwest Asia:

On its completion, the port is expected to open new vistas for development and cooperation in the region. The port is expected to offer facilities of transshipments, warehousing, coastal and transit trades, industrial as well as commercial facilities for international import-export trades. The above said are specifically referred to the Oman, UAE, Saudi Arabia, Iran, Iraq, China, Central Asian States, Qatar and other countries of the region.

The Gwadar port is also believed to offer a cost-effective, safe, secure and uninterrupted supply of natural energy. This uninterrupted supply will help all these countries to sustain and smooth industrial development and growth. With its geo-strategic position, Pakistan will bridge the transportation gaps and will offer a shortest possible route for the energy transportation. At that same time, it will offer a shortest possible route to the warm waters of the Arabian Sea.

Developments at Gwadar Port:

With the partial technical and financial assistance of China, Pakistan has successfully completed the first phase of the deep-sea port in the Gwadar. The Gwadar port was initially inaugurated on the 20th of March 2007. A number of projects are already completed for about 50% and the rest of working is on the go. The Phase 2 of Gwadar will include; a major cargo terminal; a ro-ro terminal, two oil terminals and four container berths.

A- The Kara-Koram Highway:

Decided as to up-grade the KKH as the upgraded road is believed to be providing a short route to the sea and will be superficially beneficial for the product manufacturers from China. The KKH is also believed to be serving as an overland route for trading between India and China. It will also facilitate Pakistan and China in terms of trade and energy improvement, development of the railway links, oil and gas pipeline linkage and the fibre-optic connectivity along the highway under one project.

B- The railway System:

Along the KKH a railway line is developed and will be connecting China and Pakistan and is considered as a vital part of the energy and trade corridor. The aim of this railway web is to facilitate the trade activities as well as transport energy in case other means are not operational for any reason. This rail track will be linked to Gwadar as Gwadar will be carrying the oil-refining as well as storage facilities.

C- The Energy Pipelines:

The framework of the agreement on the energy cooperation was initiated back in 2006. According to this agreement, an energy pipeline of 30-inch diameter will be installed from Khunjerab to Gwadar. This pipeline will pass through Awaran, Pir Muhammad, Khuzdar, Shikarpur, D. I. Khan, Kundian, Mianwali, Talagang, Pindi Ghraib, Fateh Jang, Haripur, Mansehra, Patan, Dasu, Chilas, Bunjil, Gilgit, Sust, and Khunjerab pass.

Benefits of Gwadar Port for Pakistan:

Top on the list is that with Gwadar, Pakistan can fulfill its energy needs and it can also secure benefits including; enhancement of trades with middle east and Cars; relations with the regional and neighbor countries will be improved; trades will be enhances; TAPI and IPI pipeline projects may lead to neutralized relations with India. Pakistan can also earn massive foreign exchange through transit fees and thus can improve its fore exchange reserves. With Gwadar port, the backward areas of Pakistan will improve gradually but significantly. There will be improvements in the literacy rate and the living conditions of backward areas of Pakistan and a lot of new jobs will come up due to foreign and local investments in the area. With the improvement in the overall economy, there would be an improvement in the hotel and tourism industry as well.

It is amazing that a fishing village to yesterday is soon to become the hub of regional trade activities supplying Pakistan with the most needed support in all ways possible. The amazing significance of the Free Economic Trade Zone and the Gwadar Port is well known to the Government of Pakistan and is thus working on many different aspects of the idea to promote the value of Gwadar to international investors and to provide them will all what it takes to convince them of any kind of big or small industrial or residential investment. Expected is to have a brighter future as soon as the Gwadar Port is completely operational and playing in the field.

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