Pakistan’s revenue generated by the blue economy is just $450 million but its actual potential is more than $100 billion.

HOW MUCH CAN PAKISTAN EARN FROM BLUE ECONOMY?

WHAT’S BLUE ECONOMY?

Blue Economy defines as:

All economic activities contribute to development, improving livelihood, and creating jobs using the ocean, seas, and coasts while ensuring environmental sustainability of the oceans.

Economy is major concern for any nation today. The blue economy is an emerging popular concept, which is an efficient use of water resources and safeguards the world’s oceans for sustainable growth and development.

The blue economy includes the following industries:

• Sea Food Industry
• Ports
• Shipping Companies
• Renewable Energy
• Maritime Transportation
• Coastal Tourism
• Food and Energy
• Climate Change
• Waste Management
• Mineral Resources

Around 80% of world trade is carried out by the sea. Globally, 350 million people are employed in the seafood industry. Like the green economy, the blue economy aims for the improvement of human wellbeing and social equity. It, not just concern about market growth; but also for the protection and development of blue resources.

The Blue Economy of Pakistan:

It is well known that 30% area of the earth is covered by land, and the other 70% by water. Out of 155 countries, 44 countries don’t have sea, although the other 145 are blessed with beautiful oceans and seaports. Such countries having seaports have more opportunities for development and growth through Blue Economy. Pakistan is blessed with a vast area of oceans with huge coastline, natural harbors, blue resources, etc.

In the case of Pakistan, we do not take advantage of a blue economy like other developing economies. In 2020, the Government of Pakistan started to focus on the Blue economy. They declared 2020 as the year of the blue economy.

As per the close estimations, the Global ocean economy worth $2.4 trillion yearly and delivering $5-600 billion each year to humanity. Many developing countries have earned billions of dollars annually but Pakistan’s revenue was just $450 million. But the actual capability of Pakistan is to earn more than $100 billion.

Pakistan got 1,050 km longest coastline, marine resources, sea trade, harbors, and maritime professionals for the development of the maritime sector. The maritime sector of Pakistan is considered the jugular vein of the economy because it carries 95% of trade. Additionally, 100% of minerals and resources are being imported through the sea route. Thus this sector is considered the largest component of Pakistan’s existing blue economy.

Pakistan has an Exclusive Economic Zone (EEZ) and Continental Shelf. Exclusive Economic Zone (EEZ) which covers 240,000 Sq. Km and continental shelf covers (50,000 sq. Km). Pakistan is also blessed with mangrove forests, has 0.6 million hectares of mangrove ecosystem which is the tenth-largest in the world.

Pakistan is passing through the first phase of blue economic development. We need to focus on the following sectors to boost our blue economy.

1. Shipping Companies

Shipping Industry has a great past in the history of Pakistan. In 70’s shipping industry of Pakistan was at its peak. Around 10 shipping companies were taken over by Government of Pakistan. The National Shipping Corporation was established in 1963. At that time NSC had a capacity of having more than 50 ships but during the dark era of General Zia’s rule Pakistani ship industry suffered an irreversible loss. The number of ships declined from 50 to dozens. Thanks to new Government policies shipping sector is getting again attention and investment from both the private and public sectors. Now National Shipping Corporation has more capacity to carry containers and vessels etc. Now it is earning profit even more than 2,500 million Rupees, earlier it was even lesser than 1,500 Million Rupees. The same is the case with cargo lifting with an approximate capacity of 10,000 tons.

Our shipping industry is growing, but it still needs proper management and attention for growth. The government is providing great opportunities for investors to invest in the shipping industry. This will result to save foreign exchange and promote the country’s foreign trade.

National Shipping Corporation

Furthermore, Pakistan’s government is trying to bring involvement of private sectors into this as well. NSC has 7% share in national imports and exports only. Apart from that other imports and exports are conducted through foreign companies. If the capacity of the Shipping Corporation is increased, Pakistan can save more than 1.5 billion dollars annually.

Shipping Industry needs much more improvement. It needs the repairing of ships, highly skilled professionals, investments, and planning for its improvement. Besides, the shipping industry in the whole world is responsible for 92% of trade through seas and oceans. Pakistan could also align to the latest trends through which the shipping industry can get stable, then it will play a great role in generating good GDP and GNP. Therefore, with the stability of the blue economy, the economy of Pakistan would also develop. Pakistan can benefit from such an aim by developing its shipping industry to engulf this market in the future.

2.Ports and Infrastructure:

Pakistan has the following ports:

• Karachi Port is known as the busiest port in Pakistan. Around 60% of the nation’s cargo is handled by this port. More than 1700 cargo ships visit Karachi port annually. There is another project with this that is Pakistan’s Deep-Water Containers Port.
• Port Qasim is the second biggest and busiest port in Pakistan. It approximately carries 40% of the national cargo. It is located in Pitti Creek. Port Qasim has a well-organized infrastructure, it has linkage with the six tracks of railways and the highway is around 15 Km away from this port.
• The airport is also, around 22 km away from this seaport. The only private petroleum terminal (FOTCO) of Pakistan is located here in Port Qasim. In this port, more than 1500 ships visit annually.
• Gwadar Port is another developing port; it is located ahead of the Persian Gulf in the Arabian Sea. Gwadar port is known as the best deep-sea water port in Pakistan. Gwadar port has strong connectivity with the roads and railways in Balochistan.

There is a need for improvement in infrastructure in these ports to get higher earnings. If we invest in more ships than our cargo business leads towards higher growth.

3. Sea Food Industry:

Pakistan’s seafood industry is very small relative to its vast potential. Seafood contributes 1% in the GDP of Pakistan and More than 10,000 people are employed in this sector. Additionally, it also provides food and other stuff essential for living. Pakistan’s seafood industry has a worth of more than $1 Billion. In the products of the fish industry, Pakistan holds 28th rank in the world.

Pakistan has huge domestic and an international market of fish, shrimps, and fish products. Around 600,000 tons fishes are caugth which covers domestic demand and could be exported as well. Pakistan has earned a lot of profit by exporting fishes. Despite this, there are fish farms in Balochistan and Sindh, but lack of management and attention we can’t earn enough. Japan, U. S. A. China, Saudi Arabia, Dubai, Malaysia, S. Korea, Hong Kong, Sri Lanka, and Singapore are other major importing countries. Currently, Pakistan is exporting seafood worth $450 million, but it could be enhanced to $2-2.5 billion if proper deep-sea fishing policy is introduced. Pakistan is selling fish at $2.27-2.5 per kg which is very cheap in price, whereas other countries are selling $7 per kg.

Pakistan seafood industry is saverely affected with water pollution. It includes oils from ships, domestic and industrial waste, chemicals found in marine life. Another problem is the over-fishing of shrimps throughout the year. Additionally, lack of institutional facilities, shortage of fish seed, lack of basic knowledge of fish farming, and capital to run new ventures results in lower production. Hence, the Pakistani fishing industry needs major modernization to make it more productive.

 4. Ship Maintenance:

Ship maintenance is another opportunity that has importance in infrastructural sectors. As ships are all in all at the ports, so they need to be well organized in this regard. Broken and damaged ships need well maintenance.

This Industry of Ship Making and Breaking is also very important in the blue economy. Pakistan is also one of the top countries that are enjoying profit through this industry. According to 2011 statistics, Pakistan has demolished around 1485 ships. The Ship Breaking place is located at Gadani, Balochistan coast. It also generates employment levels. If the government supports this industry then it will generate more revenue. As it is the world’s largest place that breaks that many ships. Pakistan should pay attention to this and work for its improvement to increase growth and development of this sector.

5. Offshore Resources

Pakistan has two offshore resources the Indus and the Makran in the Arabian Sea. The Indus offshore is the second-largest offshore in the world. Furthermore, an increase in investments can stabilize this. Offshore resources are rich in minerals, and oils, but they are untapped yet. These resources can provide GDP Growth, employment, stuff for food, and medicines, etc.

6. Tourism:

Another significant point in the blue economy of Pakistan is its coastal tourism. In most countries, coastal tourism presents the most important economic activity as it contributes to government revenues and foreign exchange earnings, creates employment opportunities, and augments businesses.

Pakistan tourism contributes only $0.3 billion in GDP despite having $4 billion potential. The primary reason behind this lesser contribution to the GDP is the lack of interest in governments in Pakistan and tourism management.

Pakistan has many attractive tourist destinations along its coastal belt. Coastal tourism in Pakistan is a lot to discover. Kund Malir beach is newly discovered in area of Balochistan. It is included in the 50 most beautiful beaches of Asia last year. Most of the tourists are visiting this place. This beach is only good to visit at day time because there is no availibity of restaurants, only a few huts constructed on the coast. Furthermore, electricity issue will occur at night, due to this customers face many problems. Authorities should build more attractive huts, a ramp on the coast and different facilities should be given, which increase employment level and revenue as well.

Eva Zu Beck and many other foreign travel vloggers came, explored, and presented a very positive side of Pakistan. This indirectly raised the tourism business of Pakistan. There are more than 10 beach spots in Pakistan right now that have been discovered.

Coastal tourism can play an important role in the economy of Pakistan. Additionally, tourism will increase people-to-people contact within the region and across the globe. If the government starts to focus on tourism, it can provide revenue of more than $4 billion. Pakistan has beautiful beaches along its coastline.

Conclusions

The vision of sustainable growth and development is only possible if political elite would demonstrate strong will and seriousness towards this sector. Pakistan needs to invest in this sector to generate more revenue, If all these sectors as discussed above can be improved then it will boost our economy.

Issues such as poor infrastructures, poor management, regional instability especially bad law and order situation in Balochistan, lack of coordination and awareness between departments and ministries need to be resolved.