KARACHI, Nov 23: The government wanted maximum participation of private sector for strengthening the shipping industry and bringing more ships under Pakistani flag and was ready to give all possible incentives and facilitation.

"Prime Minister Shaukat Aziz is keen to see huge investment from private sector in shipping industry. We are bent upon inducing private sector by giving them maximum incentives for boosting the economy," Federal Minister for Communications Senator Babar Khan Ghauri said in a meeting with ship owners here on Tuesday.

He constituted a committee including five prospective ship owners to formulate concrete proposals aimed at redressing the grievances of ship owners for inclusion of more private sector shipping lines under Pakistani flag.

The committee which would be headed by Director-General Ports and Shipping Capt. (Retd) Anwar Shah would also draw a road-map to follow up implementation of decisions within shortest possible time.

Federal Secretary Communications Fazal-ur-Rehman said with the creation of a separate ministry, the shipping sector was now being focused. The government was committed to upgrade and strengthen this very promising and important sector, he said.

The ship owners told the minister that banks were hesitant to extend loans to Pakistani ship owners. The banks needed to be encouraged in this regard as the shipping industry was considered capital intensive, requiring huge investments for acquisition of vessels.

Due to lack of understanding of shipping industry, they were constrained to operate from outside Pakistan by owning vessels under foreign flag, they informed. The ship owners further said that lack of confidence due to inconsistency of the government's policy in the past was another main problem they were faced with.

They pointed out that although the new shipping policy had provision for tax exemption, yet the Central Board of Revenue held the right to change the stance and impose tax on this industry. Similarly, Merchant Shipping Ordinance was promulgated in 2001, but some actions on issuance of follow up rules were still to be finalized and implemented.

Another major impediment identified by them was amendment to Pakistan and Indian Shipping Protocol which prevents Pakistan and Indian flag vessels for carriage of cargo for third country destination.

Denying access to the available Indian trade next door, ships under Pakistan flag have to sail empty to South China Sea for cargoes and this proves to be uneconomical for ship owners.

They urged that the protocol needed to be expeditiously amended which would remove one of the major blockades to private sector intended to invest in the shipping industry.

The delegation of ship owners also called for level-playing field for private sector in competition with public sector. The meeting was also attended by other senior officers of the Ministry of Ports and Shipping. -APP