Central Asia connectivity: Govt considering offering soft loans to transporters

KARACHI: The federal government is contemplating to offer soft loans for the transporters to upgrade the country’s dilapidated logistics network for central Asia connectivity.

However, the stakeholders have opposed the proposal of soft loans, urging the government to reduce duty and taxes on imported and locally produced goods carrier to facilitate the transporters in upgrading their logistics network.

Presently, around 0.6 million goods carrier are being operated for inward and outward cargo movement in the country. However, there are not more than 1000 goods carrier, which fulfil the international requirements to operate for transit trade.

This was also admitted by the prime minister’s commerce adviser Abdul Razak Dawood in an exclusive talk with Daily Business Recorder after meeting the CEEJ members in Islamabad early this month. “The government is cognisant about the issue hence we are contemplating offering loans to the transporters to update the country’s dilapidated logistics network,” he said.

The government has planned to transit goods under the TIR Convention and tested it successfully when the first-ever truck from Uzbekistan reached Pakistan under the TIR Convention in 48 hours. However, the country’s dilapidated logistics network is unable to fulfil the requirements for transiting goods under the TIR Convention.

Talking to Business Recorder, Arshad Jamal, chairman APCAA and licensed logistics service provider confirmed that around 0.6 million goods carrier were registered for inward and outward cargo movement in the country, out of them, not more than 1000 could meet the international requirements for transit trade.

He said that soft loans for the transporters to upgrade their goods carrier fleet for central Asia connectivity could not serve the purpose but would create additional financial burden on the transporters.

He was of the view that if the government reduced the duty and taxes on imported and locally produced goods carrier then the transporters could be able to upgrade and also expand their goods carrier fleet as per international standards, exponentially.

To a question, he said that over 60 to 70 percent drivers had ‘fake driving license’ which he termed another serious challenge for Pakistan to yield fruits through transit trade.

“Even Afghanistan doesn’t allow Pakistani drivers to transit goods under APTTA, due to the said reasons, shifting the cargoes to Afghan carrier for further transportation.

The government has to take serious measures on war-footing basis, if they want to turn table in their favours through transit trade agreements with Central Asian countries otherwise it would be beneficial to one side,” he added.

Copyright Business Recorder, 2021