KARACHI: The government’s apathy towards the fisheries sector has plunged the Karachi Fisheries Harbour Authority (KFHA) into a serious financial crisis that may affect all kinds of harbour activities, including seafood exports worth millions of dollars.

According to sources, the KFHA has recently been served a ‘final disconnection notice’ by the K-Electric for non-payment of dues. The Feb 28 notice warns the authority to immediately pay their Rs6.9million dues, otherwise electricity to the harbour could be discontinued at any time.

“It’s not just the electricity dues, payment of salaries to employees have also been delayed. Pensioners, too, are suffering on account of the present crisis,” said a KFHA official.

The harbour market operates round the clock, he explained, and if the power connection was disconnected, it would seriously affect all kinds of activities at the harbour. The sale and purchase of fish, fish processing plants and the operation of storage facilities and icing units are likely to be affected.

Sources said that the crisis had much to do with the way the government had been running the show at the Fishermen’s Coopera­tive Society (FCS), currently in complete disarray and awaiting new elections.

Though the KFHA owned the harbour land, it depended on the FCS and exporters to pay a certain amount to the KFHA under an agreement to run its financial affairs.

The FCS had not paid the KFHA a single penny since 2010 and currently owed Rs70m in ground rent, Rs30m in electricity charges, Rs55m in repair and maintenance expenditures, and Rs80m for using fresh water (this amount is claimed by the Karachi Water and Sewerage Board), sources said.

Officials at the KFHA said several reminders had been sent to the FCS, but they received no reply. The FCS had collected a huge commission on the fish catch but had spent nothing on harbour development or fishermen’s welfare, they added.

“Rs200m is pending with the FCS. The amount includes payment for the improvement work the authority has carried out at the harbour,” Shuneed Ahmed Memon, the engineering director at the KFHA said, confirming that a final power disconnection notice had been served on the authority.

The annual deficit of Rs50m in the KFHA budget, he pointed out, was met by government funds, which were received once in three years. “Higher authorities have been informed about the gravity of the situation and a letter requesting a grant has also been sent,” he said.

Another factor aggravating the crisis, sources said, was the exporters’ resistance to increasing ground rent.

Sources at the KFHA said exporters were currently paying Rs20,000 per month for a plot of 1,000 square yards. The last increase in the ground rent of a processing plant was from Rs150 to Rs250 per square yards in 2009.

“This increase was made on the condition that the KFHA would not further increase ground rent till 2014. Now, the exporters are not even ready to increase the rent as per law, even though it is clearly mentioned in their respective leases that there shall be an increase of 10pc in ground rent annually,” a KFHA official said.

Exporters wanted the increase in rent to be conditional on the facilities and good hygienic conditions at the harbour, which had no relevance with their lease agreement, he argued, adding that the authority had limited income resources which were insufficient to bring about major changes at the harbour.

Zafar Iqbal Kundi, who heads the Pakistan Fisheries Exporters Associa­tion, however, was of the opinion that the financial crisis had occurred because of corruption at the FCS and had nothing to do with the exporters.

“Every factory is paying ground rent under an agreement which expired in 2016. Since there is a discord between the KFHA and exporters over how much rent should be increased, the matter of a new accord is pending,” he explained, adding that there were only 15 to 20 export units at the harbour.

He couldn’t give any statistics when asked about the total amount paid by exporters as rent to the KFHA.

Saeed Baloch, representing the fishermen’s union at the harbour, insisted that fair and transparent elections of the FCS, scheduled later this month, was the only solution to the crisis.

“We have repeatedly requested government officials, including the chief secretary, to restore the lawful format of the FCS and avoid making political appointments at the FCS, [a practice] which has ruined the fisheries sector,” he noted.

The FCS has been in a state of disarray for more than a year following action taken by law enforcement agencies against some of its key administrative officials who were picked up for interrogation on char­ges of massive corruption. Elections have finally been announced by the cooperatives department for choosing new members for the FCS board.

Published in Dawn, March 11th, 2017