In a bid to reduce congestion at the Karachi port, lawmakers in Islamabad have teamed up with DP World, a UAE-based logistics company. According to Arab news, officials from both countries have finalised terms for a freight corridor project from Pipri Marshalling yard to Karachi port.

 

The entire project deal with DP World is expected to bring in three billion dollars in investments and is expected to spur employment levels in Pakistan. According to data from the International Monetary Fund (IMF), unemployment rates currently rest at an uneasy 7.5 percent. However, this figure is expected to decline once billions of greenbacks fuel Pakistan's new freight corridor.

 

Pakistani businesses and independent contractors could also get a share in this investment if they are able to secure contracts that enable them to work on the project. Businesses specialising in the production of steel, cast and wrought iron could witness a boom as the project will require a sizable amount of these materials.

 

News about the construction of the corridor comes at a great time, as earlier in the month, Custom News reported that thousands of containers remained stuck, with importers having to bear sizable financial losses because of demurrage charges.

 

A feasibility study of the corridor project by Think Transportation revealed that city roads remain congested around the port region because of the significant amount of cargo passing through it. Since cargo remains stuck, traffic levels remain high inside the port, which detrimentally affects port logistics.

 

However, officials from Pakistan Railways and the National Logistics Cell (NLC) will now oversee decongestion efforts. The extension of the railway network by connecting the Port is a wise move as it will significantly cut back on travel times and the frequent delays which plague both importers and exporters alike.

 

The Pipri marshalling yard, where freight wagons will be organised into trains, and its surrounding regions are also expected to reap the rewards of the corridor project. Businesses in the region could leverage the newly gained significance of their geography as they can access the port with ease.

 

An example could be Bin Qasim Packages Private Limited, which could benefit immensely as exporters from across Pakistan could send their goods to Pipri for packaging purposes right before being sent to the port for shipping.

 

Importers are also expected to benefit as the frequency of their having to pay demurrage charges will decline significantly. This will improve the profit levels of major and minor importers alike as their costs are expected to decrease.

 

Analysts speculate that the construction of the corridor is a major step in making Pakistan ‘a gateway to Asia’. The project could prove instrumental in the promotion of regional trade.