Early signs of a small Gwadar town transforming into a new international port city have started to materialise.

Most roads are freshly carpeted and sprawling buildings are sprouting up around Gwadar but blue virgin beaches and a coastline of around 1,000 kilometers from Karachi to Gwadar paint a history of neglect.

This is more pronounced for a city that sits on the strategic mouth of the Arabian Gulf and the Strait of Hormuz, witnessing the movement of large oil shipping lines to Asia, Africa and Europe.

The landscape of fishermen and boat makers’ shanty dwellings is fast changing into modern houses, business centres and hospitals, raising hopes that a potential business hub may be just a few years away.

While this may materialise as China opens up its western borders for development and mitigates transportation risks, with relocation of Beijing’s surplus production infrastructure and industry, Gwadar may become the starting point of a trade and business hub arising out of the multi-billion dollar China-Pakistan Economic Corridor (CPEC).

The intangible outcome of such a transfer of expertise from China is already taking place in the shape of adaptation of techniques and technology for daily use as evident from the construction of a five-storey CPEC business centre in almost eight months, involving hundreds of offices, shops, conference halls and recreation facilities to facilitate around 400 businesses.

According to Dostain Khan Jamaldini, the chairman of the Gwadar Port Authority (GPA), the Chinese have placed a demand for 38,000 skilled workers by 2023 for Gwadar Free Zone alone. At present, a total of 2,500 workers are working on various GPA projects including 2,000 local workers working closely with 500 Chinese.

The workers required by China are related to fields like electronics, engineering, hotel management, housekeeping, plumbing, SAP-IT, beauty, mechanics, English and Chinese language, carpentry and ship making. The first 5,000 workers are currently undergoing crash training at CPEC Technical and Vocational Institute Gwadar and will graduate by May this year.

The landscape of fishermen and boat makers’ shanty dwellings is fast changing into modern houses, business centres and hospitals, raising hopes that a potential business hub may be just a few years away

Director General Gwadar Development Authority Dr Sajjad H Baloch said extra care was being given to ensure that displaced persons felt at ease to vacate their ancestral places. He said about 300 persons, who willingly vacated their land for Gwadar Free Zone, were given two 500 sq. yard plots and a shop to compensate for their livelihood.

According to Mr Dostain Chinese investment for Gwadar was estimated to be about $2 billion out of the larger CPEC portfolio including the upcoming new Gwadar International Airport, Eastbay Expressway, CPEC Free Zone, port facilities and energy projects.

But overall investment in the port city could gradually increase to $500bn in a few years provided the current pace of development continued.

He said around 400 companies had sought permission to set up medium to large businesses but permission has so far been given to only five industries like oil, steel plants, motorbikes and marine trade. The process will speed up after the approval of the Gwadar Master Plan currently being finalised by Chinese experts.

The major challenge for the emerging port city remains the acute energy and water shortage even though authorities aim for the country’s largest airport and a dedicated oil city spread over 80,000 acres at Gwadar.

According to Dr Baloch, the groundwater around Gwadar was unfit for human consumption and drinking water requirement has to be met through three small dams dependant on rainfall. The current water requirement is about 6 million gallons per day (MGD) and water supply is no more than 2.5MGD, leaving a shortfall of almost 4MGD, he said.

Likewise, the current power demand for the city is estimated at 25-30 megawatt against a peak supply of about 14MW. Dr Sajjad said plans were afoot to install a 45MW generator to meet immediate requirements, to be followed by a 300MW coal power project by the Chinese in due course for future requirements.

In the meanwhile, the value of real estate has been growing exponentially and a 500 yard area could vary between Rs10-30m for residential and commercial purposes.

In view of some early fraudulent instances, the federal and provincial governments have suspended almost 75 out of 100 real estate schemes until the Gwadar Master Plan is finally submitted to Pakistani authorities by their Chinese counterparts by August 14.

He said the central attraction of Gwadar under CPEC would be the Mega Oil City spread over an area of 80,000 acres. “We have shared the PC-1 (project concept papers) of the petrochemical complexes and other oil installations to the federal Ministry of Petroleum and Natural Resources and have allocated the required land”.

Once the federal government gives a go ahead, “we will embark upon the land acquisition,” he elaborated. The oil city would be used for storing and dumping oil, LPG and LNG and their processing for onward transportation to China. Under the master plan, a total of 290,000 acres of land would be required for the entire Gwadar city including 160,000 acres for residential needs, Dr Sajjad concluded.

Mr Baloch said the federal government was funding construction of roads and more than 200km of road projects against a total of 324km had already been completed. Two fish harbours are also being funded by the Federal government while a public sector technical institute is under construction along with a 35km underground electricity supply system.

A representative of China Airport Construction Group Corporation Jianxin Liao and Shoiab Soomro the Civil Aviation Authority focal person said soil testing for the new international airport would be completed by early February to enable finalisation of project design around April 2018.

The airport will be spread over 4,300 acres compared to Karachi’s 3,700 acres, Lahore’s 2,800 acres and about 3,600 acres of Islamabad’s new under construction airport. It will be capable of handling 380 large aircrafts and more than a million passengers per annum, on completion in three years after contract signing through bidding.

Published in Dawn, The Business and Finance Weekly, January 29th,2018