Gwadar The Golden Gateway

“GWADAR” THE GOLDEN GATEWAY

& NEW GREAT GAME

KASHIF MANZOOR QURESHI

[email protected]

GWADAR Gwadar THE GOLDEN GATEWAY is situated on the borders of Arabian Sea and lies in the Balochistan Province of Pakistan Persian. Its 600 KM long coastline is one of the most gorgeous coastlines of the world with shining blue water and marble white sand. Gwadar is a new heart line, a new commercial hub for the world and has gain tremendous importance due to it’s strategically importance in the world. Gwadar Port is the third port of Pakistan Karachi and Port Qasim being the other two. It's the First Free Trade Port of Pakistan, and, also the First Deep Sea port of the entire region. Gwadar port emerges as a place of great strategic value, giving tremendous boost to Pakistan's importance in the whole region, extending from the Persian Gulf through the Indian Ocean to Southeast Asia and the Far East.

Introduction Gwadar is well known for it strategically position in the world. It’s gaining more importance because of The Great Oil Game which is centre of attraction for developed countries. Gwadar is situated in the province of Blochistan which 40 percent of Pakistan's land mass possesses important reserves of oil and natural gas as well as extensive mineral resources. Pakistan has an estimated 25.1 trillion cubic feet (Tcf) of proven gas reserves of which 19 trillion are located in Balochistan. According to the Oil and Gas Journal (OGJ), Pakistan had proven oil reserves of 300 million barrels, most of which are located in Balochistan. Other estimates place Balochistan oil reserves at an estimated six trillion barrels of oil reserves both onshore and off-shore (Environment News Service, 27 October 2006)1.

The new oil mega city on the shoreline of Balochistan has two main working areas, petrochemical city and biggest refinery with storage complexes and warehouses in the region. After the completion of project Gwadar port will become the economic and trade transit point for Pakistan, Afghanistan, China and central Asian states. 1

http://www.globalresearch.ca/index.php?context=va&aid=7705

History Region of Gwadar is surrounding by Makran which was ruled by Persian Empire for many year. During the march of Alexander the Great, his admiral, Nearchus, led a fleet along the modern-day Makran coast. After the collapse of Alexander's empire the area was ruled by Seleucus Nicator, one of Alexander’s generals. The region then came under "local rule" around about 303 BC2. After being in sideline form the pages of history city was once again become active after the Arab-Muslim army of Muhammad bin Qasim captured the town of Gwadar in AD 711. Mugal rulers rule over for many year before the Portuguese explorers captured and sacked Gwadar in the late 16th Century and this was then followed by almost two centuries of local rule by the various Balochi tribes. In 1783, the Khan of Kalat granted suzeranity over Gwadar to Taimur Sultan, the defeated ruler of Muscat3. When the Sultan subsequently retook Muscat, he was to continue his rule in Gwadar by appointing a wali (or "governor"). In 1958, the Gwadar enclave was transferred to Pakistan. It was then made part of the Balochistan province In 2002, the Gwadar Port project (of building a large, deep-sea port) was begun in the town. The government of Pakistan intends to develop the entire area in order to reduce its reliance in shipping on the port of Karachi. In addition to expanding port facilities, the Project aims to build industrial complexes in the area and to connect the town via a modern highway to the rest of Pakistan. By the end of 2004 the first phase had been completed4.

Location It is located about 533 km from Karachi and 120 km from the Iranian border. Gwadar Port is situated at the mouth of the Persian Gulf and outside the Straits of Hormuz5, where majority of the world's oil passes daily. It is estimated that through that route 30% of the world's daily oil supply passes6. Gwadar is closet to the key shipping routes used by the mainline vessels in the region with connections to Africa, Asia and Europe and enjoys high commercial and strategic significance. Various professional studies manifest that Gwadar Port location is the most advantageous one as an alternative port, which could handle mother ships and large oil tankers. Picture Showing GWADAR in centre of the world7. 2

http://en.wikipedia.org/wiki/Gwadar http://en.wikipedia.org/wiki/Gwadar 4 http://en.wikipedia.org/wiki/Gwadar 5 Gwadar Cornor http://www.Gwadarcorner.com/index.php?action=port 6 News.bbc.co.uk/2/hi/south_asia/6469725.stm 7 Image:Orthographic projection centred over Gwadar http://en.wikipedia.org/wiki/Image:Orthographic_projection_centred_over_Gwadar%2C_Pakistan.png#filelinks 3

Infrastructure Gwadar is located on the Gulf of Oman close to the entrance of the Persian Gulf, about 460 kilometers west of Karachi. It has road with Iran which is only 72Km away from Gwadar. Government is constructing the road link from Gwadar to Afghanistan and rail network between Gwadar and Iran and Afghanistan. Government is focusing on laying the HavelianKashghar (China) and Quetta-Kandahar (Afghanistan) railway tracks”. In 2006, Ministry of Railways announced that Gwadar will be connected to Pakistan Railways network at an expected cost of $ 1.25 billion. The construction of the port has spurred other major infrastructure projects in the area. This includes the 700 km Makran Coastal Highway which is now complete. The road links Karachi with several ports along the coast including Ormara, Pasni, Gwadar and will be extended to the Iranian border in the future.

Road map 8

8

Road Map.jpg

www.lib.utexas.edu

Distance from Gwadar9 DISTANCE FROM S No.

CITY/REGION

GWADAR

LINKIS

1

KARACHI

470 KM

ROAD/AIR/SEA

2

ISLAMABAD

900 KM

ROAD/AIR

3

IRAN

72 KM

ROAD/AIR/SEA

4

AFGHANISTAN

1300 KM

ROAD/AIR

5

CHINA

2000 KM

ROAD/AIR

6

CENTRAL ASIAN STATES

2000 KM

ROAD/AIR

7

STRAIT OF HORMUZ

400km

SEA

To connect western China with Central Asia by land routes, Pakistan is working on building road links to Afghanistan from its border town of Chaman in Baluchistan to Qandahar in Afghanistan. In the northwest, it is building similar road links between Torkham(Pak Afgan Boarder) and Jalalabad in Afghanistan. Eventually, the Gwadar port will be accessible for Chinese imports and exports through overland links that will stretch to and from Karakoram Highway in Pakistan's Northern Areas that border China's.10

Port Infrastructure11 “Current port infrastructure 3 multipurpose berths, each 200 meters long. 1 Ro–Ro berth 1 service berth, 100 meter 4.5 km long approach channel dredged to 11.5 m inner harbour and 12.5 m outer harbour Width of channel 165 m Port basin with turning areas with diameter of 400 m Related port infrastructure and port handling equipment, pilot boats, tugs, survey vessels, etc. 9

http://www.revuemilitairesuisse.ch/node/149

10

Gwadar: China's Naval Outpost on the Indian Ocean Tarique Niazi, the Jamestown Foundation, China Brief 2/28/2005. http://www.asianresearch.org/articles/2528.html 11

http://Gwadarnews.com/Gwadar-port.asp

The port, currently, has the capacity to handle 50,000 DWT bulk carriers and 25,000 DWT container vessels. Engineering Consultants International (Pvt.) Ltd (ECIL), a leading Pakistan consultancy firm has been engaged in supervising all the shore civil works under construction at Gwadar and design the East Bay Express way and supervision of its entire construction works”.

Investment The total cost of the project is estimated at $1.16 billion USD, China pitched in $198 million and Pakistan $50 million to finance the first phase. China also has invested another $200 million into building a coastal highway that will connect the Gwadar port with Karachi. The second phase, which will cost $526 million, will feature the construction of 9 more berths and terminals and will also be financed by China.12 Pakistan has invested more than $2 billion to

upgrade Gwadar and in the completion of related development programmes in the last two years. The provincial Government of Balochistan itself is spending Rs 4.5 billion in Gwadar.

GEOPOLITICAL IMPORTANCE13 Gwadar geopolitical importance can be judge with the fact that it is stated as strategically best location both for global economy and military objectives. World economical powers have shows there comments about this location. Different states have different views and concerns.

America presence in the Gulf region has created worries for China. Moreover US entry in Afghanistan enhances these worries for China. Having set up its bases in Central, South, and West Asian countries, the U.S. virtually brought its military forces at the doorstep of China. Saudi Arabia is biggest of producer with 261 billion barrels of proven oil reserves (more than one-fourth of the world total) and up to 1 trillion barrels of ultimately recoverable oil.14117 Shortly after the Arab oil embargo in 1973-74, the United States (and other Western countries) created the Strategic Petroleum Reserves (SPR) as the nation’s first line of defense in case of an oil crisis. In November 2001, President Bush made an unprecedented decision to fill the SPR to its full capacity of 700 million barrels.15 And in 2001, the United States imported 54 percent of its oil requirements, out of which 30 percent came from the

12

Gwadar: China's Naval Outpost on the Indian Ocean Tarique Niazi, the Jamestown Foundation, China Brief 2/28/2005. http://www.asianresearch.org/articles/2528.html 13

http://en.wikipedia.org/wiki/Gwadar

14

Bahgat Gawadat, “Oil and Militant Islam: Strains on US-Saudi Relations,” World Affairs, (Winter 2003) Bahgat Gawadat, 2003.

15

Persian Gulf region.16 US economy depends upon oil supply chain. After 9/11 US relation with Saudi Arabia are not as firm as they were before and it is looking for alternate for oil supply. CAR’s natural resources are alternate for that and nearest supply line and access point to persion gulf is Gwadar. Only a few days before the September 11 attack, the U.S. Energy Information Administration documented Afghanistan’s strategic “geographical position as a potential transit route for oil and natural gas exports from Central Asia to the Arabian Sea.17 Desire for a strategic alternate of oil aside, the indications of wearing American commitment in the Middle East does not necessarily indicate lowering of its resolve in the area as the Pentagon is becoming increasingly interested in the concept of mobile offshore bases for deployment in the Persian Gulf, to ensure the U.S. military access to critical regions in the future.18 Persian Gulf and Indian Ocean areas are, therefore, priority of United States policy makers for the predictable future. President Carter’s statement in his 1980 State of the Union address, subsequently labeled as the “Carter Doctrine,” that “Any attempt by any outside force to gain control of the Persian Gulf Region will be regarded as an assault on the vital interests of the United States of America and such assault will be repelled by any means necessary including military force.19 US interest in the Indian ocean is part of there policy but China growing terms with Islamabad specially near to Persian Gulf region has now alarmed U.S. America is preparing India as competitor of China and believes that if China got access to blue water than it will have control on the oil supply chain of the world. Pakistan is under immense pressure by Washington to involve US in the project instead of China.

China is emerging as a super economic power of the world in the recent years. Despite occupying a huge area of world's land, it doesn't have any port of hot waters, which can be used the whole year. The distance of Chinese industrial approach to the Shinghai port is approximately 16000 km and the sea travel of 2-3 months is additional. This costs them a lot in the form of taxes and duties as well. As compared to this, Gawadar port is only on a distance of 2000 km from China and the port is working for the whole year because of the hot waters here. Therefore, the interest of China in the development of Gawadar port is infact in the interest of Chinese economy.

16

Energy Information Administration, Energy Situation Analysis report: May 3, 2002, www.cis.state.mi.us/mpsc/reports/energy/02summer/oilimports.htm 17 Energy Information Administration, Oil, war, Geo-Politics and Hegemony, www.eia.doe.gov 18 Jason Sherman, “Pentagon Group Details Sea Base Concept,” DefenceNews.com, http://www.defensenews.com/sgmlparse2.php?F=archive2/20031027/atpc7674087.sgmlH (accessed March 23, 2005) 19 Robert H. Johnson, “The Persian Gulf in U.S. Strategy: A Skeptical View,” International Security, Vol. 14, No. 1 (Summer, 1989): 123.

As discussed earlier that 60 % of oil supplies to China are from the Persian Gulf where US presence has alarmed China. Having no blue water navy to speak of, China feels defenseless in the Persian Gulf against any hostile action to choke off its energy supplies. This helplessness set Beijing rush for alternative safe supply routes for its energy shipments. The planned Gwadar Deep Sea Port was one such alternative for which China had flown its Vice Premier, Wu Bangguo, to Gwadar to lay its foundation on March 22, 2002.

Iran The Persian Gulf is an important trade route in the strategic northern reaches of the Indian Ocean. Some 80 percent of the world’s oil tankers leave the shores of the Persian Gulf destined to other parts of the world.20 Geopolitical location of Iran within the Persian Gulf region is such that the northern shores of this Gulf belong entirely to Iran, which enables her to control the Straight of Hormuz. Passage through Hormuz is an issue of concern several times a year when Iran holds its war games at the mouth of Gulf.21 Iran want to supply Gas to India which routes is through Bolachistan and secondly Iran is alos well candidate for CAR,s oil and gas resources supplies to rest of world.

India Another fast growing economy and rival of Pakistan, India which depends to a large extent on the import of crude oil and petroleum products for meeting its energy requirements from the Persian Gulf region. India’s production from existing oil fields has been declining over the time, increasing its dependence on the import of oil.22 India seeks to develop economic relation with CARs in collaboration with Iran and desires to have access in this market.

Japan The importance of the Indian Ocean to the Japanese cannot be exaggerated; it would not be wrong to state that the Indian Ocean is a lifeline of Japan. Japan averaged 3.9 million bbl/d of net oil imports from the Persian Gulf during 2002.23 Japan’s energy concerns dictate its policies in favor of oil from a Caspian export pipeline terminating at the Indian Ocean.163 Therefore; it is safe to assume that Japan will support the operationalization of the Gwadar port project.24

Dubai Dubai is the hub of business not only for Gulf but also for rest of the world including Europe, United States, Africa, China and Central Asian States, simultaneously. The gulf region is 20

Danesh Pajooh, “Iran and the Strategic Significance of the Persian Gulf”, Indian Ocean Security and Stability in the PostCold war Era (1995): 223. 21 Donna J. Nincic, “Sea Lane Security and US Maritime Trade: Chokepoints as Scarce Resources,” in Sam J. Tangredi, 157. 22 Mohan Malhotra, “India’s oil supply deficit spurs reforms to lure foreign capital,” Oil & Gas Journal, (June 2, 1997). 23 Energy Information Administration, Persian Gulf Oil and Gas Exports Fact Sheet 2004 (September 2004), http://www.eia.doe.gov/cabs/pgulf.html. 24 The Geo-Politics of Caspian Oil,” The Janes Intelligence Review, (July 01, 2000).

facing many political conflicts specially after Iraq war there are many ups and down in the gulf region which has disturbed the whole region and due to unstable condition more disturbance is expected in the next few years.

Circles in the Maps showing Duabi and Gwadar. It can be seen Gwadar is more assessable than Dubai and offer ideal location. Ships and Vesselss have to cover more distance to reach Dubai after passing through Gulf of Oman.

In such a scenario, a substitute of Dubai is essential to be located before the crisis hits the finances of millions. That substitute shall be a nearest point and access-able by the whole all to ensure regular supply of oil from Gulf to the outer world. Gawadar proves to be the nearest and infact more cost-effective substitute of Dubai, from many aspects. Dubai has concern about Gwadar that if it starts working then importance of Dubai reduces automatically and world finance will transfer to Gwadar instead of Dubai. Gwadar offer more attractive facilities like property rights, more easy route as compare to dubai, easy handling

of huge number of ships, container and vessels because of it natural location and easy access to world most populated region. Gwadar take over Duabi in all aspects and in much better position to facilitate the world.

Central Asian states are full of natural resources but these states are landlocked. After Independence for USSR they are trying to develop there economies. Currently some trade of these countries is going on through Karachi. Due to Afghan crises road link could not established between Karachi and central Asian stated but Gawadar being near to Iranian border will provide port facilities to Central Asia as well. China is eyeing the unexploited natural resoucres of Central Asia. She is already conducting oil transactions with Kazakhstan. But with the impending plan of laying five pipelines from Central Asia to Gawadar China will ensure big oil and gas supplies to run the wheels of her fast expanding economy at home. Ser No

COUNTRY

CRUDE OIL MILLION BARRELS

NATURAL GAS (TCF)

COAL (MILLION SHORT TONS

1

Kazakstan

5417

56

37479

2

Kyrgyzstan

40

0.2

895

3

Tajikistan

12

0.2

Minimal

4

Turkmenistan

546

101

Minimal

5

Uzbekistan

594

66.2

Minimal

6

Total

6609

232.6

Proven Reserves, Central Asia

38374 25

Source: Energy Information Administration.

According to report China and Pakistan have already held talks for laying strategic pipelines from Gawadar to Chinese border to transport oil from South Asia. The 14.5 meter deep and 5 kilometer long approach channel through three berths will be capable of handling carriers up to 50,000 dead weight tons. Beijing will build refinery and petrochemical complex at Gawadar with initial 10 million ton capacity, which would later go up to 20 million tons.26

25

U.S. Energy Information Administration, “Country Analysis Briefs - various,” http://www.eia.doe.gov/emeu/cabs/contents.htmlH (accessed April 12, 2005). 26 Global World by K.N. Pandita http://geopolitics.world-citizenship.org/geopolitics/index.php/wp-archive/95

Trans-Afghan Gas Pipeline a long undeveloped project of a 1,500 kilometers long TransAfghan Gas Pipeline (TAP) from Turkmenistan to Gwadar and other parts of Pakistan that hopes to thrust Turkmen natural gas to global markets is also poised to step off the drawing board after completion of the port project27.

Gas Pipe line from Central Asian States to Gwadar

GEOECONIMICAL FACTORS Economic benefits of Gwadar port, besides the geo-strategic importance are: capitalizing the opportunities for trade with landlocked Central Asian states and Afghanistan, promotion of trade and transport with Gulf States, trans-shipment, essentially of containerized cargo, unlocking the development potential of the hinterland, diversion of influx of human resources from upcountry to Gwadar, socio-economic uplift of the province of Balochistan, establishment of shipping-related industries, oil storage, refinery and petro-chemicals, export processing industrial zones and many more avenues .28 Gwadar could emerge as a key shipping point, bringing Pakistan a much-needed income, and when combined with the surrounding areas could become a trade hub, once road and rail links connect it to the rest of Pakistan, Afghanistan and Central Asia. Pakistan’s business community seems to be in favour of Gwadar port being selected a free trade zone and an export-processing zone. The port comes as a much-needed national requirement in the wake of the rise in cargo traffic at Keamari and Bin Qasim, which are operating at full capacity. It is expected that Pakistan's maritime traffic would rise by three folds by 2010. With the construction of a third port, it is estimated that Pakistan will not only be able to meet its own requirements of the future but also offer its port facilities to the neighbouring countries. 27

NAVAL POSTGRADUATE SCHOOL, MONTEREY, CALIFORNIA Ammad Hassan June 2005, PAKISTAN’S GWADAR PORT – PROSPECTS OF ECONOMIC REVIVAL 28 http://www.gwadarcorner.com/index.php?action=about

Over the past two years, the trade volume China and Pakistan has jumped to $2.5 billion a year, accounting for 20% of China's total trade with South Asia. A Bilateral Free Trade Area is underway which will bring tariffs between the two countries down to zero. Chinese investment in Pakistan has increased to $4 billion, registering a 30% increase just over the past two years since 2003. Chinese companies are 12% of the foreign firms operating in Pakistan, which employ over 3,000 Chinese nationals.29

To oppose Sino-Pak collaboration, India has brought Afghanistan and Iran into an economic and strategic alliance. Iranians are working on Chabahar port in Sistan-Baluchistan, which will be accessible for Indian imports and exports with road links to Afghanistan and Central Asia. India is helping build a 200-kilometer road that will connect Chabahar with Afghanistan. Once completed, Indians will use this access road to the port for their imports and exports to and from Central Asia. Presently, India is in urgent need of a shorter transit route to quickly get its trade goods to Afghanistan and Central Asia. Presence of China in the way will create obstacle in establishing good economical relation between these countries.30 Gawadar is now destined to be the most important upcoming coastal town located on the inter junction of the three most strategically and economically important regions of the world

29

Gwadar: China's Naval Outpost on the Indian Ocean Tarique Niazi, the Jamestown Foundation, China Brief 2/28/2005. http://www.asianresearch.org/articles/2528.html

that are oil rich Middle East, South Asia where one- fifth of world population lives and the Central Asian Republics endowed with mineral wealth and an educated.31

Gwadar Comparison with Ports in the region32 Table 1. Statistical Comparison of Ports Feature

No. of Berths

Dubai Ports Authority Rashid Jebel Ali 3 5 71

Salalah

Bandar Abbas

Chahbahar

Karachi

Qasim

Gwadar(after Phase-II)

33

24

4

30

10

12

Channel Length (Km)

0 15

0

6.4

1

12

45

4.5

Channel Depth (m)

3 17

16

13

0

3

12

20

5.1

2

1

-

13232

1184

--

-

Traffic Handled (in Million TEUs) Vessels Called

0.8

?? 0.42

393

806

??

Source: Official websites of all ports. There are three broad parameters on which ports compete with each other. These include: (1) inter-port for same trade, (2) intra-port for same markets, and (3) Intra-Terminal for same services.33 Selection of a port is a shipper’s decision which, in addition to geographical location, looks for a full complement of services, including export packaging, warehousing and distribution, bonded operations and a Free Trade.34

SWAT Analysis Strength: Strategically Gwadar is link between three highly important regions of the world: the oil-rich Middle East, densely populated South Asia and the economically rising and full of resource Central Asia. Gwadar gain importance due to following main reasons. These are as follow

31

Shaikh.Mohammed & India Co. vs. Gwadar, Mid East crisis, Pakistan’s Talibanisation

32

NAVAL POSTGRADUATE SCHOOL, MONTEREY, CALIFORNIA Ammad Hassan June 2005, PAKISTAN’S GWADAR PORT – PROSPECTS OF ECONOMIC REVIVAL 33

World Bank, “Port Reform Toolkit,” Module 6, Hhttp://www.worldbank.org/html/fpd/transport/ports/toolkit/mod6.pdfH (accessed April 05, 2005). 34 NAVAL POSTGRADUATE SCHOOL, MONTEREY, CALIFORNIA Ammad Hassan June 2005, PAKISTAN’S GWADAR PORT – PROSPECTS OF ECONOMIC REVIVAL

Geo Strategic position of Gwadar has made it one of the most attractive and important regions in the world. Natural deep sea port Rich oil & natural gas reserves in the province of blochistan where Gwadar Close to the important Straits of Hormuz35, through which more than 13 million bbd of oil

passes daily.

Current location of Gwadar is much more access able than Dubai, Oil containers, Vessels and cargo ships have to go inside the gulf region to reach Dubai port but as far Gwadar is concern the route is very short and easily access able.

Weaknesses China wants access to the hot waters and has eye on the oil reserve of the world many of the other countries who don’t want to see china as growing nation are trying to create instability in the region. Unstable political situation in the province of Blochistan is hurdle in the way of progress toward development of the region. America and its allies are not in favour of imagining china to become the only economical giant and to capturing oil of central Asian states and Blochistan. Dubai and some other ports in the middle east area which are currently financial hub of the world and duty free zone are not purely in favour of Gwadar because it will some how reduces their importance in the region. Iran is a big oil producer and it is land is one of the world's most mountainous countries. Most of oil in Pakistan is in Blochistan proven oil reserves are 300 Million Barrel. Flow of oil is from Iran to Blochistan. If mega oil city is constructed in Gwadar with world biggest oil refinery it could also be threat for Iran oil reserve. India has some serious threats about Gwadar. According to Indian Naval Chief in an interview with leading newspaper of south-east Asia shows his concerns about Gwadar by claiming that Gwadar port has strategic implications for India: Indian naval chief36 Suresh Mehta said, Hindustan Times. Moreover he Says port will enable Pakistan to control world’s

energy corridor. Talking about china Indian naval chief said that “China is making new strategy with china and they name it as China had a strategy called “String of Pearls”, according to which it seeks to set up strategically located bases and outposts along its energy lines across the globe to monitor and safeguard energy flows. “Each pearl in the string is a link in a chain of the Chinese maritime presence,” he described. Local Tribes in the area are under the influence of foreign secretes agencies and try to create the political and economical unrest in Gwadar. Just because of lack of education and

35

36

http://en.wikipedia.org/wiki/Gwadar

Daily Times, 23 January 2008, http://www.dailytimes.com.pk/default.asp?page=2008%5C01%5C23%5Cstory_23-12008_pg7_53

strong traditional ties of local people with their tribe heads make them unaware of current the development going on in the region. These tribes head force people to do violence activities to destabilize the process of development in the area.

Opportunities Gwadar is business hub in future. There are lot of business and investment opportunities in this area. The emerging mega oil city has two main components i.e. petrochemical city and the biggest refinery with storage complexes and warehouses in the region. Beside this there are many other areas where many other opportunities exist. Real Estate Area of Gwadar once an ordinary piece of land is among the most valuable area in term of real estate investment. More than 75 NOCs have been issued up to May 2006 to Different Builders & Developers by Gwadar Development Authority (GDA). People have invested huge amount of money in buying residence and commercial plots in the region. Lot of foreign investors specially form European countries have shown keen interest in purchasing property in Gwadar. Duty Free Industrial Zone & Hotels Government has announce free port Industrial zone at Karwaat about 45 Km from Main Jinnah Avenue of Gwadar. This Govt. Project is consisting of 10000-acres land for industry purpose. Pearl Continental Hotel has started it working in beautiful location, Almost and more 5star hotels are under construction. Saindak Copper Gold Beside oil Blochistan has huge resources of Copper & Gold. The Saindak Copper Gold project is in progress by producing 12500 tons 'raw copper' daily. MRDL, a Chinese company, is doing the whole work. Latest machinery has been installed in addition to a 50 MW powerhouse. The Chinese company MRDL has so far invested $25 million on the project 37. Special Economic Zone Government is development of a Special Economic zone which will bring additional economic activities to the area and provide further boost to the Port. The Government intends to provide the investors with the most attractive working conditions, relaxing concession, and incentives and all other facilities of international standard to attract foreign investment. Others Besides the Geostrategic importance Gwadar has some of the many other areas of investment and many opportunities available. Opportunities of trade with landlocked central Asian states and Afghanistan. Help trade and transport with Gulf States. Trans-shipment essentially of containerized cargo. Help to boost up the development process of neighbouring areas. 37

Gwadarnews.com

Providing more job opportunities for local blochs and others. Establishment of shipping related industries. Export process zone. It will reduce dependency on existing port at Karachi which is currently financial hub.

Threat Threat to Gwadar is its own importance in the region. Many reason come in the way which are hurdles in the progress of GWADAR. Combinations of internal and external threats are big factors which come in the way of full implementation of project. Some of main threats which Gwadar currently faces are US Involvement and Its Pressure on Pakistan to stop co-operation with China. India and Iran joint activities to destabilize situation in Blochistan Uncertain political position in Pakistan Middle East states more involvement in the Gwadar Tribal heads constant terrorist activities to threat investors and worker Gwadar is on the highly active seismic zone and earthquake jolt have been measured in the area several times. To overcome the threat of Tsunami and earth quake the area should be planned under the guidance of world best architects.

Conclusion Gwadar is a golden gateway and it is important because of its unique strategically position on globe. Its importance can be analysed with the fact that all the countries in the nearby region including superpowers like US and Europe are interested in occupying this area. Pakistan neibhouring countries are constant threat for Gwadar. If the government adopt intelligent policies on Gwdar by eliminating the concern of opponents and once oil and gas

from Central Asia and the Middle East begin to flow into the huge refineries of Gawadar, it will have significant impact on oil-related regional strategy. Pakistan’s Makran coast could become the alternate of mega complexes of Gulf States and the world could enter in “new great game”.

PEST Analysis Political Despite of all the efforts done by government to make Gwadar the future business hub there are some internal and external factors which are causing political instability in the area. Positive Aspects. Government is spending huge amount of money to make area ideal for huge foreign investment. Local and foreign investors are showing keep interest to buy property both for business and residential purpose. Despite of fact the political conditions in the Pakistan are having rise and fall but government policies on Gwadar are constant. Special grants are given to Blochistan to make area more prosper both for people and business. Special loan are given to local residence of Gwadar for starting there own business. The Central Board of Revenue (CBR) has given exemption of customs duty on the import of machinery, equipment and bunker oil to the operators for rapid development of Gwadar port. Government allotted military total of 11,000 acres land at Gwadar port to build 'Combined Defence Complex (CDC). The proposed Complex appears a step in the same direction for presence of the Defence forces at this important strategic place.

Negative Aspects. Internal: Blochistan has tribal tradition. Some of the famous tribes are Bughtis, Murree, Maingals who has strong influence on residents of region. Tribe head in Blochistan don’t want to see the area developing because through this their domination in the area reduces. People follow the orders of tribe head and tribe heads create political unrest in the area.

External: The law and order situation in Balochistan has been a question mark for the federal government. By keeping eagle eye on province, which is rich in natural resources such as oil and gas and other precious minerals, the federal government reaches on conclusion after investigation that some foreign hand is active in the province to destabilize the whole region. This has left with no other option but to take some extra ordinary measures to make sure that anti-Gwadar elements can not simply act at their will against the laws of the state.

Economical When the project of developing Gawadar as a deep-sea port was undertaken in 2004, Beijing provided 80 per cent of 248 million US Dollars as the initial development cost of the port. Sino-Pak planners expect the port to initially generate revenue of 23.6 billion US

dollars, with a capacity to reach 42.2 billion38. Pakistan has invested more than $2 billion to upgrade Gwadar and in the completion of related development programmes in the last two years. The provincial Government of Balochistan itself is spending Rs 4.5 billion in Gwadar. Pakistan is an impoverished and underdeveloped country. Its economic record was not good in the past39but mega projects that the government has started in Balochistan, including Gwadar port, are going to generate an estimated $60 billion every year over the span of time and provide a firm basis for the socio-economic uplift of the province40. During the last few years huge economical activates have been noticed through government department. Huge investment in real estate, hotel and tourism sector has been observed.

Socio-Cultural Gwadar’s location and history have unique blend of cultures. The Arabic influence upon Gwadar is strong as result of the Omani era. For many years people of Gwadar has dual nationality both of Pakistan and Oman but currently they are only citizens of Pakistan. Area has remarkable religious diversity, being home to no only Muslims, but also groups of christens, hindus and parsis as minorities. Populaton41

ADMIN UNIT AREA (in sq. Km) Total Population District Gwadar 12,637 185,498 Tehsil Gwadar 5,019 109,748 Tehsil Pasni 7,618 75,750

Male Female 99,436 86,062 59,170 50,578 40,266 35,484

The overall literacy rate of Gwadar district is 25.47%. For a long time Gwadar was small fishing town and people were very backward living without some the basic facilities. Those people once poor are now well aware of importance of their region and due to heavy investment in real estate sector they are much flourish than before. In recent years the presence of Afghan refugees disrupted the delicate ethnic balance in the province by making the Pashtuns at least numerically equal to the Baloch in recent years .

Technological Gwadar is under developing region but as well technology, during the short span of time all the latest technology has been provided to that region to attract more investment in the region.

38

Global World by K.N. Pandita http://geopolitics.world-citizenship.org/geopolitics/index.php/wp-archive/95

39

http://www.Gwadarcorner.com/index.php?action=about

40

http://www.Gwadarcorner.com/index.php?action=about

41

http://www.gda.gov.pk/pages/literacy.html

Initially three multipurpose berths, each 200 meters long equipped with latest technical equipment are ready for operational purpose. Telecommunication facilities like telephone, broadband internet facility has provided in the area. Transportation facilities have been provided for the residence of the areas which connect them to rest of the country by road. Gwadar Airport is functional and providing facilities to people. The government is focusing on laying the Havelian-Kashghar (China) and QuettaKandahar (Afghanistan) railway tracks”. In 2006, Ministry of Railways announced that Gwadar will be connected to Pakistan Railways network at an expected cost of $ 1.25 billion (Rs. 75-billion). Luxurious hotels are facilitating people and more 5 star hotel chains have started construction on ideal locations of Gwadar. Electricity & natural gas has been provided to the area. To meet the future energy demand Government of Pakistan has sign an agreement with Iran to provide 100MW of Electricity for Gwadar. Natural gas has been provided to Gwadar form neighbouring city of Sui which has huge natural gas reserves. Leading technological Institutes are planning to open their campuses in Gwadar. A hospitals equipped with all latest facilities has start providing facilities to people. PSA of Singapore has taken over management of Gwadar Port which was the highest bidder for the Gwadar port operations. PSA of Singapore is world leading port management operator in the world currently operating in 26 ports of 15 countries which are mostly in Europe42. Equipped with the latest technologies PSA Gwadar International terminal has good experience in port management

Conclusion Pakistan have to give more attention on the current political situation not only in Blochistan but through out Pakistan. Special teams should be send to talk with tribal head and educate people about the benefits of Gwadar because mostly the people of Blochistan are uneducated have have very strong tribe influence. Government polices should be more relax-able for investors and businessman. Once people get awareness about the current importance of Gwadar, the city will turn most important trade point in the world. Although, the Gulf was to be considered on of the best zones for trade and business till now, but the rapidly changing political conditions in Afghanistan, Iraq and specially Middle East has created an air of uncertainty, of its future, in the minds of business community. The

42

www.psa.com.sg

business community in the Gulf has already started exploring new horizons for future trade and what best could they get than Gwadar43.

Confidence Level Ser

Sources

Confidence Level

1

Internet Articles

6

2

Literature Review

8

3

Newspapers

7

4

Government Websites

8

5

Private Websites

7

6

Research Reports

8

7

My own analysis

7

No

43

http://www.globbizavenue.com/features.asp#3

Gwadar Pictures From satellite