ISLAMABAD, June 19: The government is negotiating with the Daewoo Shipyard of Korea to help establish a subsidiary of the Karachi Shipyard and Engineering Works at Gwadar for repair and maintenance of bigger local and foreign ships and vessels.

Official sources told Dawn on Tuesday that the government has decided to take advantage of strategic location at Gwadar, viz-a-viz Gulf and fast pace of growth of maritime activity in the region by having a branch of KSEW at Gwadar.

The capacity in the Gulf for such repair of vessels is limited and Gwadar can turn out to be an ideal place for such a facility. This will be undertaken in collaboration with some leading international shipyards.

"We have had an initial exchange of ideas with the Daewoo Shipyard of Korea and they have shown keen interest," a source said.

The facility will be one of the trigger industries for bringing up Gwadar port and development of Gwadar region.

The facility can then be further upgraded to undertake state-of-the-art shipbuilding of bigger size and high-tech ships.

The KSEW has the limitation of depth of water in the present channel. It is one of the reasons that the KPT is planning deep draught container terminal and cargo village for which KSEW wanted a requisite space so that it can undertake bigger ships for repair and maintenance.

A total of Rs2.8bn are being earmarked for the project, both for Karachi and Gwadar, out of which Rs1.5bn are expected to be made available during 2007-08.

The major objective of the project includes embarkation and disembarkation of ships and vessels, lunching of new shipbuilding projects, including submarines, ship's hull survey, cleaning and painting, steel renewal of ships, repairs and overhaul of ship machinery, inspection by classification societies for commercial ships, certification of ships by classification societies, propellers and shafting works, Sonar works for warships and ICCP repair works.

The project relates to industrial sub-sector of industries and commerce and mineral sector. It will contribute to productivity of the shipyard and fulfil the ever-increasing demand of the shipping industry. The shipyard is the only industry of its type which is fulfilling the needs of local shipping industry through repairs.

The programme proposed is the capacity enhancement of ship repairs by installation of a 4,000-ton ship lift system, with the replacement of old and obsolete machines, as well as upgrade and modernise the existing repair facilities of the KSEW.

The project, on completion, will provide modern and highly productive docking facilities in the yard. This will, in turn, meet country's growing requirement of ship repairs.

With increased turnover, the KSEW will generate profit, and as such it would become a profit-making entity.

It was stated that PN, PNSC, PQA, KPT and Gwadar Port and MSA have plans to rehabilitate and increase their fleets which have been reflected in their current and perspective plans.

The KSEW is the only yard in the country which can meet the growing demand in maritime sector. Its docking facilities have not been enhanced since 1970 which has created constraints of docking of vessels which is affecting the productivity. The new ship lift and transfer system will enable the KSEW to meet the additional work-load and schedule of the customers and quality of product.