ISLAMABAD, Dec 31: The World Bank has asked Pakistan to reduce port charges by 15 per cent and fire 25 to 40 per cent staff employed at its two major ports so as to be competitive with regional ports for enhanced trade and economic links with the global market, particularly China, Afghanistan and Central Asia.

This makes part of the bank’s comprehensive recommendations put forward on the request of Prime Minister Shaukat Aziz for improvement in Pakistan’s logistic chain under the National Trade Corridor Programme.

The recommendations, currently under consideration of the government, also call for outsourcing of port services to the private sector; closure of Karachi Dock Labour Board and retrenchment of its staff; and updating of National Ports Master Plan to re-evaluate the appropriate roles of the Karachi Port Trust (KPT), the Port Qasim Authority (PQA) and the upcoming port of Gwadar.

The recommendations envisage transformation of the KPT to landlord status and improvement of port infrastructure to modernise and meet international standards of cargo-handling capacity and draft depth to cater for larger vessels. Navigation should also be made available on 24x7 basis, it is recommended.

The World Bank believes that both KPT and PQA are overstaffed.“The KPT has made bold progress, reducing staff numbers from 14,000 in the late 1990s to 5,000 in 2004, but it needs further streamlining,” says the bank, adding that the 1,600-strong PQA was also overstaffed but not to the extent of the KPT.

According to the bank, the port entry charges are high at both the ports. The combined KPY charges on ships for port entry, tugs, pilotage and berth hire amount to $0.82 per GRT (Gross Registered Tons). This would be equivalent to $26 per TEU (twenty foot equivalent unit) on the assumption of a 35,000 GRT ships handling 1,000 TEU. Well above international standards, these charges are not much higher than those at main Indian ports.

“But these are over five times higher than those at the dominant container trans-shipment ports of the region: Colombo, Dubai and Salalah,” it said. “These rates deter lines from calling with large ships and they are the main reason for the Pakistan Port Surcharge.”

The bank is also critical of port management by navy officers.

It believes the dominance of the navy in port management is unusually high by international standards. Many of the top positions are occupied by naval officers on short-term assignments, from which they either return to the navy or retire. Their postings have two negative effects: one, the officers may be less commercially minded than what will be necessary for future port operations; two, the predominance of short-term navy assignments in high positions may well limit the incentives of the permanent port staff to perform well in order to advance their careers.

The bank has also advised Pakistan to increase the ports depth both for entrance and dredging because the position of its ports, as feeding ports, would be very serious for the country’s economy in the long run. These problems would include additional costs of feeder services to and from regional hub ports such as Salalah, Colombo or Singapore.