Pakistan's port in troubled
waters By Elizabeth Mills
The port at Gwadar is without doubt
currently Pakistan's flagship infrastructure
project. A source of great pride for the Pakistani
government, its much anticipated inauguration as
the country's energy hub has been twice delayed
and it is envisaged to become operational by
year's end.
Built with Chinese assistance
- just how much is debatable, though US$200
million for the first phase is an accepted figure
plus loans - this multibillion-dollar scheme is
regarded as not only an important economic asset
but also a strategic one.
The first phase
included the construction of three multi-purpose
ship berths, while the second, to be completed by
2010, involves nine more berths, an approach
channel and storage terminals, by which time it
will provide full warehousing, trans-shipment and
industrial facilities.
The Pakistani government is positioning Gwadar as
"an energy port and hub for storage and refining".
No country knows the strategic value of
the port more than India, which is unsettled at
the prospect of having at the very least a
possible Chinese listening post so close to home
and at worst a possible Chinese naval presence on
the Indian Ocean.
Consider for one minute,
however, the possibility that despite the hype,
fears, euphoria and general interest, Gwadar might
just be a big, lumbering white elephant. Consider
also the possibility that the security situation
is now so poor in the area surrounding the port -
and more widely in the surrounding province of
Balochistan - that even the port's authorities are
reportedly questioning whether the facility can
become operational in the near term.
Autonomy-seeking rebels are fighting for
greater political rights and a bigger share of
profits from gas-rich Balochistan's natural
resources. According to official data, there were
187 bomb blasts, 275 rocket attacks, eight attacks
on gas pipelines, 36 attacks on
electricity-transmission lines and 19 explosions
on railway lines in Balochistan in 2005. At least
182 civilians and 26 security-force personnel died
in the province during last year.
Consider
further the possibility that the Chinese became
entangled in Gwadar's construction as a mere
investment opportunity rather than as a part of a
grand strategic plan, and may have come to regret
the decision as the death toll of their engineers
working on the project has risen and the obstacles
to the port's construction and operation
increased.
These considerations aside,
let's take a look at the development and its
proposed facilities. Gwadar is in the restive
southeastern province of Balochistan, sitting on
the southern Makran coast, about 70 kilometers
from the border with Iran and about 320km from
Cape al-Hadd in Oman.
Pakistan already has
one major commercial port at Karachi, but it is
envisaged that while Karachi - due for expansion
and modernization - will remain the key commercial
and naval port, Gwadar, given its position, will
be a regional energy hub.
Given that it is
situated alongside sea lanes near the Strait of
Hormuz, through which about 40% of the world's oil
tankers pass, the government is eyeing Gwadar's
position as a key entry point for energy supplies
for Central and South Asia, as well as western
China.
Alongside this, the Pakistani
government has ambitions to develop Gwadar into a
South Asian Las Vegas, a regional entertainment
hub filled with casinos and five-star hotels.
This is a far cry from what Gwadar was
just five years ago. Before the port's
construction began (2002), Gwadar was considerably
smaller, with just one high school, basic
infrastructure and limited job opportunities.
In fact, most employment centered on
fishing and small-scale smuggling in what is the
country's poorest province. As a result, when the
authorities made the port announcement, the town's
inhabitants welcomed the decision, envisaging
better prospects. After all, they had benefited
from the construction of the Makran coastal
highway, linking Gwadar with Karachi. Why should
the port be any different?
Inevitably,
there were dissenting voices, not least the tribal
bigwigs who feared that urbanization would deprive
them of their traditional power bases and
influence. That said, for the man in the street,
the positives of such a large project looked set
to outweigh suspicions and fears.
In fact,
what has unfolded is a tale of displacement, lost
job opportunities, dubious land deals and
increasing local violent hostility. The
insurgency-related problems of Balochistan are
well documented, but have been exacerbated in
recent years by the new security threat emanating
from the discontent surrounding the port's
construction. A sense of local nationalism has
emerged, fueled by disengagement with the fruits
of the project.
The rapid increase in land
prices in the region has made a small elite
extremely wealthy, though for the everyday
resident of Gwadar the reality is very different.
Allegations of land grabs and shady deals are rife
with the benefits accrued by influential outsiders
and their cronies coming at the expense of the
town's indigenous inhabitants. Most residents have
also found themselves running short on water as
well as displaced, rehoused inland, a considerable
distance from the sea and their traditional
fishing areas. And Gwadar reportedly still has
just one high school, despite its burgeoning size.
Too little and too late, the authorities
are now acting. The director general of the Gwadar
Development Authority (GDA), Mir Ahmed Bukhsh
Lehri, is on record as having in May pledged a
huge infrastructure package. Lehri announced that
infrastructure would be of an international
standard and include a 350-bed hospital, a sports
complex, a park, a mosque and a desalination plant
as well as two new harbors and housing for locals.
Perhaps this would have been welcomed several
years ago, but it is difficult to envisage
anything but a cold and skeptical reception to
this news now.
If proof were needed of the
local population's changed attitude, it is
witnessed in the security situation. When the
port's construction first started, it was reported
that about 200 Chinese engineers operated freely
in the town, welcomed by its inhabitants and
housed without security fears among the
population. As the project has developed and local
grievances increased, the number of engineers has
steadily decreased and the 20 or so who are now
left are stationed at the army's barracks, under
guard 24 hours a day. A number have died in
attacks, the largest of which occurred in May 2004
when three were killed and 11 others (nine of whom
were Chinese) injured in a car-bombing.
At
odds with this disconcerting reality is the
international attention being paid to the port.
Admittedly, some of the key international port
operators are notably absent from bidding for the
project, but even so, the past few months has seen
a flurry of speculation over which international
company would win the rights to operate the port.
Will it be DP World of the United Arab Emirates or
Hutchison Port Holdings of Hong Kong, or perhaps
even Singapore's PSA International, all of whom
have submitted an expression of interest (EoI)?
Perhaps, however, the question that should be
asked is whether the whole scheme is actually
viable.
Currently, the Pakistani
government forbids foreigners from traveling
without its permission in parts of Balochistan
because of the broad security risk. In fact,
anyone seeking to do so first has to secure a
no-objection certificate. It is unclear just how
the authorities are going to get around this
obstacle once Gwadar the tourist city is up and
running.
As the situation stands, a
five-star entertainment resort in a part of
Pakistan surrounded by barely controlled desert
(and not forgetting that Afghanistan's
Taliban-heavy provinces border Balochistan) will
surely top the attack list for a range of militant
and terrorist elements. Partying aside, the
prospects similarly look poor for the viable
operation of the port.
Its inauguration
has been delayed twice, and even now it is not
entirely clear when it will begin operating. It
appears that the port is at the stage of becoming
operational but remains unsupported by surrounding
infrastructure.
President General Pervez
Musharraf has belatedly urged the various
ministries to work together on this, with the
failure to put in place rail, road and
communications links to the rest of the respective
networks preventing the port's grand opening. So
what's causing this delay? A bit of ministry
rivalry, perhaps, or a lack of funds? Apparently
not. No, instead, the security situation is the
key problem.
This is evidenced in the
current debate over rail links. All that was
required was a link from Gwadar to the network at
the Quetta-Kohi-Taftan junction. Reports that
emerged last month suggested that a feasibility
study had been concluded and that "problems" had
been identified, prompting the ministry to
consider alternative routes. The original proposed
route ran through a particularly restive central
part of the province, but the alternative poses
topographical challenges, given the area's steep
gradients.
Add to this the security
situation in Gwadar itself and the vision of that
white elephant looms large. Sources who spoke to
Asia Times Online were allowed on a recent visit
to the area and secured the rare opportunity to
talk with port officials. Surprisingly, they
proved to be candid in their views, openly
expressing their fears that poor security in the
area would constitute such a deterrent that the
port would not be able to function normally.
Certainly, the regular news reports detailing
bombings in and around Gwadar underline this
continuing threat. A recent selection reveals
attacks on hotels under construction and even the
GDA's offices.
The government cannot be
oblivious to the situation around Gwadar, though
it has arguably been overshadowed by the wider
ongoing separatist insurgency in the province. It
is notable that a dual strategy for Balochistan's
troubles has emerged more clearly during 2006.
The federal authorities currently favor a
policy of targeted military action accompanied by
effective development spending. Interestingly,
negotiation does not appear to be an option, with
regional leaders either in detention or served
with exit certificates, preventing their return to
the province without arrest.
A total of
Rs10 billion (US$167 million) has been funneled
into developmental projects in Balochistan and the
Federally Administered Tribal Areas, though it is
unclear whether any of these funds will be
targeted on the needs of residents or whether they
will service the requirements of a burgeoning
tourist center.
In many respects, the
government is warranted in trying to exploit the
location of Gwadar and should be both commended
and supported for its foresight in looking to tap
into the lucrative energy-transit network.
That said, if it fails to surmount the
security problems and, even more basically, cannot
put the fundamental infrastructure in place for
the development, Gwadar's port looks set to fail
at the first hurdle.
Not only will this
come at considerable economic cost, but it will
undermine relations with China and simply make the
Pakistani authorities look foolish. If Gwadar is a
test case for Pakistan's wider aptitude for
diversification and grand-scheme expansion, it
appears it will receive a poor report card.
Elizabeth Mills is an analyst
covering political and security issues, with an
emphasis on South Asia.
(Copyright
2006 Asia Times Online Ltd. All rights reserved.
Please contact us about sales, syndication and republishing
.)
