AD Ports to review KPT cargo tariffs

Seven-day committee to review tariffs fixed under interim government agreement

ISLAMABAD:

AD Ports Group, a UAE-based logistics company, has agreed to review existing terminal cargo handling charges following Pakistan's demand for a reduction in fees at Karachi Port, aimed at making port operations more competitive and business-friendly.

The federal government has constituted a negotiation committee to engage with AD Ports Group on the issue of cargo handling charges. The committee comprises Chairman Karachi Port Trust (KPT) Rear Admiral Shahid Ahmed, along with the country representative of AD Ports Group. The committee is expected to submit its recommendations within seven days.

Sources told The Express Tribune that agreements signed by the previous government with AD Ports Group carried higher charges, which compromised Pakistan's commercial interests. KPT had signed a commercial agreement with the UAE-based AD Ports Group for outsourcing operations of the Bulk and General Cargo Terminal at East Wharf. The signing ceremony was witnessed by the prime minister of Pakistan, cabinet members, and senior officials from both countries.

The agreement was concluded during the interim government in February 2024. Subsequently, Federal Minister for Maritime Affairs Muhammad Junaid Anwar Chaudhry took up the matter with AD Ports Group, seeking a reduction in cargo handling charges. In response to the minister's request, the UAE ports operator agreed to review and rationalise the charges.

During a meeting with a delegation of AD Ports Group at his office, the maritime minister urged the company to rationalise terminal cargo handling charges to improve efficiency and enhance the competitiveness of port operations. Both sides also reviewed the status of ongoing projects at Karachi Port Trust.

The AD Ports Group delegation was led by Regional CEO Abdulaziz Zayed Al Shamsi and included Vice President Real Estate Abdulla Al Ansari, Board Member KGTL/KGTML Mustafa Ahmed, Country Head Pakistan AD Ports Adel Al Hosani, CEO KGTL/KGTML Khurram Aziz Khan, Project Manager Real Estate Adnan Ballaith, and Legal Advisor Saboor Karamat.

The federal minister also stressed the need to expedite the procurement of mechanisation and digitisation equipment, including cranes and loaders, to enhance efficiency and improve cargo handling at the KGTL and KGTML terminals.

In June 2023, Pakistan and AD Ports Group had signed a deal under a 50-year concession agreement. Under the arrangement, a joint venture between AD Ports Group, as the majority shareholder, and UAE-based Kaheel Terminals was formed to manage, operate, and develop Karachi Gateway Terminal Limited (KGTL).

AD Ports Group had announced that the joint venture would make significant investments in infrastructure and superstructure over the next 10 years. The planned development included deepening of berths and extension of quay walls to increase container storage capacity.

The expansion is expected to enable the handling of post-Panamax class vessels of up to 8,500 twenty-foot equivalent units (TEUs) and increase annual container handling capacity from 750,000 to one million TEUs.

At the time, AD Ports Group had also signed three memorandums of understanding with the government of Pakistan to establish a framework for improving transport infrastructure, facilitating efficient cargo movement, reducing logistics costs, and enhancing the competitiveness of Karachi Port and other mutually agreed projects. The group was also expected to provide technical expertise and advisory support to assist Pakistan in planning, designing, and implementing trade, customs, and logistics infrastructure projects.