Pak to re-tender the Gwadar Port management contract

Dubai: Pakistan announced on Sunday that it would re-tender the contract for operation and development of Gwadar port, ending media speculation that the country would sidestep an open bidding process to hand the port operation and development to an international firm, Dubai Port (DP) World.


The Gwadar Port Implementation Authority (GPIA) cancelled the previous tender process, invited expressions of interest for the concession and announced through Lloyds List that the re-tendering procedure was aimed at entering into a build-operate-transfer-based (BOT-based) concession agreement with a suitable international port and terminal operator. “The scope of the 40-year concession includes the operations of the current multi-purpose terminal, development and operations of around eight additional berths with related facilities,” the GPIA tender notification said.


The newly developed Gwadar Deep Seaport is to be inaugurated by December 2006. While industry sources said the DP World was the preferred bidder, the firm may face competition with Hutchison Port Holdings (HPH) of Hong Kong in the re-tendering process. “The re-entry of HPH could indicate close competition among the world’s leading port operators for Gwadar port operations,” sources said.


A top government official was quoted as saying a few months ago that Pakistan might scrap the open bidding process to hand the Gwadar Port management directly to DP World in a possible trade-off. Waseem Haqqie, head of Pakistan’s Engineering Development Board, said: “As far as I know there is a strong possibility of a trade-off here. I believe, after the deal is finalised, Pakistan will see some more investment in various sectors from the UAE,” which has become the largest foreign investor in Pakistan after an investment commitment of more than 124 billion dirhams made by Emaar, Dubai World and Etisalat in various industrial and real estate projects.


Industry sources said the GPIA sought to put to rest all speculation about such a trade-off by announcing that it would re-tender the process. “The inauguration of the port has been delayed twice, and even now it is not entirely clear when it will begin operation. It appears that the port is at the stage of becoming operational, but remains unsupported by surrounding infrastructure.” Sources said while serious contenders are lobbying to win the contract, the decision would strictly be made on merit. However, the DP World was a preferred bidder because the Pakistani govt had proposed to operate the Gwadar port as a free port like the Jebel Ali terminal.


Despite the recent US opposition to its taking over the management of six American ports, DP World is still the fourth largest port operator in the world. The tender notification said the operator must have extensive international experience in terminal operations with both containers and other cargo types. Sources said this requirement would make the race for concession to operate the port — which was completed with a Chinese loan at a cost of $300 million — restricted to a handful of global operators including DP World, HPH and PSA International of Singapore. Other likely bidders in the re-tendering process include Globe Marine Services of Saudi Arabia and Pakistan International Container Terminal.