KARACHI, April 24: The Dubai Port World (DPW) has laid down tough conditions in their terms of reference before entering into final agreement with the government for running Gwadar Port.

The port’s three multipurpose berths are ready to accommodate Post Panamax vessels outside the sensitive Straits of Hormuz.

The conditions, if accepted, are so harsh and in favour of the operator that it would tantamount to handing over the county’s most strategically located port on a silver platter, observed an expert on ports and shipping sector.

Sources on authority told Dawn on Monday that if final agreement on these lines was reached it would completely strip off the government from all rights and would give full authority and powers for taking all future decisions to the port operator with regard to all sensitive issues directly related to revenue, tariffs, development, expansion and operation matters of Gwadar Port.

This is not all, the terms of reference has put all future liabilities and investment costs on the shoulders of the government which includes development of infrastructure inside and outside the port areas and wants a binding and firm commitment upon them from the Gwadar Port Authority (GPA), Gwadar Port Implementation Authority (GPIA) as well as federal government.

There are two major conditions in the TOR which primarily deal with operator’s corporate structure and with matters related to operation, tariffs, and financial powers as well as development of infrastructure in future, including nine new jetties (berths) on the east bay of the hammer head port of Gwadar.

Sources said that the DPW was seeking full powers over shareholding of the port company to be held by them or any other strategic investor chosen by them. “It has further laid down a condition where management control will be fully with DPW and the government will have no control over the management and policies of Gwadar Port.”

They said that the DPW was seeking 30 years lease for the site and the port which could be renewable for two more terms of 10 years each for which the option and right would be of the operator.

The most astonishing demand being made by the DPW, the sources said, is with regard to development of new berths other than the existing and are seeking first right of refusal over them. In case the government of Pakistan lease or develop new jetties a prior approval should be sought from the DPW.

Most of the conditions are so harsh and one-sided they would flabbergast any sane person and may even force him to think that negotiations are being used as a smokescreen but actually Gwadar Port is being gifted out, another port expert said.

The to be operators of Gwadar Port, sources said, are also seeking full control over development, finance, design, build, management and operations of those nine jetties (berths) which are yet to be built under Phase II and also have the right to cap the capacity utilization.

Sources further said that DPW was also seeking unbridled freedom in determining, levying and collection of port tariffs related to “dry tariffs” and “wet tariffs.” However, the most interesting demand or condition being sought by the Dubai operator was that tariffs would not be higher than Karachi Port and Qasim which means they could be lower. This means that country’s new port would be thriving at the cost of two premier ports run by a foreign company.

Even on labour matters the DPW in their terms of reference, sources said, are seeking full freedom and are not willing to hire or absorb any existing labour or employees presently working at the port.

Sources confided that DPW was seeking all powers and rights without putting a single penny towards development as the port’s Phase I had been completed about a year back and deepening of berths and approach channel was presently going on at full swing.

The Dubai operator wants to have full powers over berthing priorities which would mean that, if accepted and agreed a ship carrying sensitive cargo needing priority berth could not be given without the prior approval and consent.

Development work outside the port such as highways connectivity between Gwadar Port and other cities like Karachi, Quetta and western China has to be carried out by government of Pakistan at their cost. Even in dredging all future financial costs will be borne by the government.