FAISALABAD: Faisalabad’s business community is in for a surprise.
After three years of being unable to use the facility, traders would now be able to utilise the Faisalabad Dry Port (FDP) after a memorandum of understanding (MoU) was signed with DP World.
The MoU means DP World, a private multinational company operating at Port Qasim, will provide a cargo train facility from FDP to the Karachi port.
The train had been suspended by Pakistan Railways (PR) after it caused huge losses due to increased cost of transportation.
DP World, which has a portfolio of more than 65 marine terminals across six continents, will launch the new service that would see cargo charges go down, said FDP Chairman Chaudhry Muhammad Siddique while talking to The Express Tribune.
The authorities moved to sign the deal with DP World after repeated pleas could not convince the management at PR to restore the cargo facility. Siddique said the cargo handling services have remained suspended, leading to a significant increase in the cost of doing business. Hence, the MoU, he added, would facilitate the business community and increase the efficiency of the port that had witnessed a consistent decline.
He said the FDP had great business potential, adding that the volume of exports and import cargoes would increase. He said that efforts would be made to keep the business cost at least equal to the one at other ports of the country.
The monthly average cargo handling, which ranged between 2,500 to 3,000 containers a few years ago, has now come down to only 600 containers, said the chairman.
According to data of the last 10 years, business at the FDP has significantly dropped. In 2004-05, the numbers of export containers were 29,613. A year later, the number was recorded at 31,305, in 2006-07 it was 33,131 before plunging to 25,641 the next. But in the last three years, the figure came down to an average of 7,000 containers each year.
In 2004-05, the port handled 5,289 import consignments, which fell to 2,086 in 2013-14. FDP authorities held PR largely responsible for the downward slide. Faisalabad is recognised as a major trading hub of the country due to its textile business. Its textile exports contribute approximately $4.5 billion out of the total earnings of $13.9 billion.
Making the FDP operational means exporters now have the opportunity to save millions of rupees, added Siddique.
Meanwhile, Siddique lamented the state of affairs at the Federal Board of Revenue (FBR), stressing that huge amounts of rebates were stuck at the tax machinery that caused cash flow problems to exporters.
Published in The Express Tribune, October 9th, 2014.