KARACHI, Jan 10: The Karachi Port has reduced wet charges in the range of 15 per cent to be effective from Wednesday (Jan 15, 2003). This reduction will significantly reduce the cost of handling vessels at the port which often cited by shipping circles as the most expensive regional port.

The reduction in wet charges would mean reduction in port dues, berthing, pilotage and haulage. These charges are paid by the shipping companies in dollars and constitutes a major chunk of port income.

In order to make up for the shortfall the port authorities have simultaneously abolished all overtime charges and are striving hard to improve efficiency at the port and transform it into a truly 24/7 port. This will not only provide relief to the port users but will also bring transparency in the working of the port.

The downward revision in the wet charges by the KPT has been hailed by all the stakeholders, including Pakistan Ship’s Agents Association, All Pakistan Shipping Association, Karachi Customs Agents Group and Karachi Stevedores’ Conference.

The Karachi port handles around 70 per cent of country’s imports and exports and its tariff has a large footprint which affects various aspects of country’s economy.

Since its inception, KPT’s tariff has been modified and revised a number of times. Such exercises, however, have usually been restricted to upward revisions with little consideration to changing trade patterns and cargo handling techniques, charges in vessel sizes, and developing regional competition.

Such actions had rendered many parts of the tariff unrealistic, uncompetitive and distorted. A major manifestation of this distortion was the lopsided ratio between wet and dry charges and Karachi port being cited as the most expensive regional port unnecessarily.

According to KPT announcement the salient features of new tariff are:

— Ratio between we and dry charges have been rationalized i.e. wet charges have been reduced and dry charges have been revised by reducing the number of slabs.

— Procedures have been simplified and unnecessary irritants because of arbitrary discretion have been removed.

— All overtime charges have been abolished and wharfage has been summarized in 17 categories only. This would afford an opportunity to the port users to work 24 hours.

— Transshipment rates have been introduced for all types of cargo and the rates for containers have been reduced with an increase in free period from 20 to 30 days.

— Discretionary free period on various accounts has been abolished.

— Storage charges on export cargo have been completely abolished.

— Procedures for handling dangerous cargo have been simplified.

— Berthing charges have been reduced by introducing 12 hour slabs (after the first 24 hours) instead of present 24 hours.

— Port dues have been reduced from $46 per GRT to $30 per GRT for less than 5000 GRT ships and $40 per GRT for ships greater than 5000 GRT.

— All extra pilotage charges have been abolished.

— Tuggage charges have been reduced from $559.5 per tug to $485 per tug.

— Ancillary charges like surcharge on liquids and direct delivery charges have been merged in the wharfage.

— Demurrage date for all types of cargo has been fixed on completion of vessel as against completion of 51pc of cargo which would simplify the system.

— Wharfage and storage charges at Napier Mole Berth have been brought at par with other landing areas.

— One time holding charges on storage have been abolished.

— Slabs on storage have been reduced to three.

— Rates for storing export cargo on plinths and covered areas have been introduced.

— Various slabs in crane charges have been finished and flat rates have been introduced.

— Booking and cancellation of cranes has also been simplified and flat rates introduced for cancellation.

— Charges from non-users of heavy lift quay cranes and floating cranes have been reduced to half of what the users will pay.

As a result of these reduction in wet charges on an average there will a reduction of around 11.40 per cent (in dollars) in one day stay charges for a typical container ships. But for typical bulk ship having average stay of seven days the reduction will be 11.02 per cent and typical oil tanker with a two day stay the reduction in charges will be around 10.83 per cent.