China is set to take operational control of Gwadar, the deep-sea port built with financial and technical assistance from China on Pakistan’s south-west coast, after the Port of Singapore Authority (PSA) has decided to pull out of a 40-year port management and development contract signed in 2007. Now China will also operate the port, which is strategically located close to the Pakistan-Iran border and the Strait of Hormuz in south-western Balochistan province.
Pakistan’s ports and shipping minister, Babar Khan Ghauri, has confirmed that the government has issued a no-objection certificate to quit the contract held by the PSA, which is going to sell its shares to a Chinese company. The Singaporean firm decided to quit the Gwadar project after Pakistan’s government failed to transfer land needed to develop a free zone, as was promised under a 40-year concession deal signed in February 2007 during former president Pervez Musharraf’s regime. Since its official opening in March 2007, the Gwadar port has been unable to become fully operational because of the unsettled issues between Islamabad and the PSA.
Gwadar is an important coastal town in Balochistan. The port has the potential to serve as a secure outlet as well as a storage and transshipment hub for the Middle East and Central Asia oil and gas supplies through a well-defined corridor passing through Pakistan. China has contributed about $198 million (Dh727 million) of the initial investment for the port project.
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