ISLAMABAD, Feb 26: Pakistan is losing about Rs320 billion or nine per cent of GNP (gross national product) every year owing to its poor quality of transportation system, which could block its plans to become a hub of regional transit trade in the coming years.

A special task force on rapid industrial growth appointed by the federal government has also found that Pakistan has record of more than 70 fatalities per million populations every year imposing a further significant cost of Rs1 billion.

Informed sources told Dawn that the task force has estimated these losses in four major areas of transportation which include roads, trucking, ports and railways and without taking into consideration the air-traffic. About 70 per cent of the 7086 km of the national road network is stated to be in poor to fair condition.

The sources said Pakistan's current transportation system was not in a position to benefit or cater to the transit trade requirements that would emerge as a result of proposed South Asia Free Trade regime or South Asia's trade with the Central Asia and possibly with Europe.

The task force has proposed the development of a National Highway Plan in consultation with all stakeholders and with a built-in monitoring and updating mechanism. It also calls for strengthening audit and procurement reporting structures of the National Highway Authority (NHA) to improve the process of contracting and supervision of construction.

The body has also recommended institution of an efficient axle-loan control mechanism to avoid damage to roads due to overloading and to share the responsibility of road maintenance contracts with private contractors within appropriately designed road maintenance contracts. About 43 per cent of trucks exceed the proposed federal axle-load limit of 12 tons.

To improve the trucking sector, the task force has suggested encouraging the entry of trucking firms into formal sector through regulatory reforms because the trucking currently remained in the informal sector owing to registration costs, regulatory requirements and high taxes.

The report also suggested introducing a system of fines similar to the one implemented by the motorway police to all the roads across the country instead of impounding the vehicles, which cause losses both to the private sector as well as to the economy.

The body calls for discouraging the market limiting monopolies like the one enjoyed by the National Logistics Cell on Afghan Transit goods and to implement the Transport Internationaux Routiers (TIR) convention to open external markets for truckers.

The report said the average dwell time on Pakistan's ports was 11 days compared to the international ports benchmark of 3-4 days. Similarly, the container handling charges at the Karachi port are $113 compared to $53 in Malaysia, $85 in India, $107 in Shanghai and $106 in Singapore.

It has recommended reduction in the free storage period from eight to four days at ports and to undertake dredging of the channel to accommodate direct calls by the mainline container ships.

The committee recommended closure of Dock Labour Board and significant reduction in port entry and maritime services charges from $0.82 per GRT. It also proposed privatization of port operations such as pilot and tug services, the engineering workshop and shore handling.

The report suggests establishment of marketing department to attract traffic and increase the depth and length of channels at Karachi and Bin Qasim ports in line with the world shipping trends besides preparation of annual statistical reports on cargo traffic, shipping traffic, cargo handling speeds, shipping times at berth, waiting times and financial indicators.

The report said that more than 90 per cent of Pakistan's railway wagon fleet was obsolete with over 30 years of age. Hence, there was a need to improve the organization and governance of the railway system through corporatization of Pakistan Railways.

The report has also suggested creating lines of business management within Pakistan Railways dealing with infrastructure, passenger business, freight business and rolling stock and accounting and finance.

The task force also recommended divestment of non-core activities of Pakistan Railways and to transfer social activities to appropriate department, launch privatisation and cessation of low demand activities.

On top of that, the task force has suggested creation of a Railways Regulatory Authority on the pattern of Nepra and Ogra and to encourage the private sector participation in infrastructure and services.