Ministry of Ports and Shipping is reportedly lobbying to ensure contracts of all public sector cargoes for Pakistan National Shipping Corporation (PNSC) without following PPRA Rules, well-informed sources told Business Recorder. The ministry argues that PNSC, ever since its establishment in the year 1979, has been playing a pivotal role towards augmentation and promotion of trade of Pakistani products at national level with the objective of saving precious foreign exchange.
Earlier imports and exports of the country were largely dependent on foreign shipping companies only. According to the ministry it is common practice all over the world that governments patronise public sector organisations operating in the maritime sector for the following reasons: (i) maintain sea borne capability in war and peace; (ii) availability of skilled seafarer in times of national emergencies; (iii) avoid total domination of its trade by foreign and developed countries imports/ exports; and (iv) ensures guaranteed continuity of supply of strategic cargoes.
In 1983 the ECC of the Cabinet, constituted a committee under the Chairmanship of A G N Kazi, former Governor of the State Bank of Pakistan, and assigned it with the task of looking into the difficulties of PNSC, and put forth measures for more cargo support for the corporation.
The committee made the following valuable recommendation: (i) the policy of the Government of Pakistan is that all public sector cargoes be carried by PNSC; and (ii) all government departments, autonomous and semi-autonomous organisations/ corporations are to utilise the services of PNSC for carrying their cargoes. However these recommendations were not followed in letter and spirit.
PNSC is currently bringing approximately 90 percent of crude oil to refineries through a long-term contract of affreightment. Ministry of Ports and Shipping has made the following recommendations to the government:
(i) reinforce the recommendations of the Kazi committee with full force; (ii) all contracts and agreements should be FoB with PNSC nominated as carrier; (iii) PNSC should act as shipping agency for all ministries, autonomous and semi-autonomous departments of the government; and (iv) organisations like PSO, TCP, PSM should have long-term contract of affreightment on a market-based formula as is being done successfully with the refineries.
The ministry maintained that these recommendations, if adopted and implemented in their entirety will yield positive results for the government in the form of saving foreign exchange and would also contribute to national exchequer in the form of taxes and dividends.