In a bid to secure funds, the Pakistani government is considering transferring control of its Karachi port terminals to the United Arab Emirates (UAE), according to a report released on Tuesday. The country’s finance minister, Ishaq Dar, recently presided over a meeting of the cabinet committee on inter-governmental commercial transactions.
To facilitate this potential agreement, a panel will be established to negotiate a commercial arrangement between the Karachi Port Trust (KPT) and the UAE government, as stated in an article published by The Express Tribune. The panel has been authorized to finalize a draft agreement encompassing operation, maintenance, investment, and development aspects. These negotiations will occur under a government-to-government framework involving a designated UAE agency. The panel will be led by Faisal Sabzwari, the Minister for Maritime Affairs, and will include additional secretaries from the finance and foreign affairs departments, the Special Assistant to the Prime Minister Jehanzeb Khan, the Chairman of KPT, and the general managers of the KPT.
The interest expressed by the UAE government in acquiring the Karachi port terminals, which were previously managed by the Pakistan International Containers Terminals (PICT), stems from a desire to raise emergency funds under a legislation passed last year. In an effort to address its financial crisis, the Pakistani coalition government enacted the Intergovernmental Commercial Transactions Act in order to expedite the sale of state assets and generate revenue.
Pakistan currently faces significant economic challenges, compounded by uncertainty surrounding the revival of a $6.5 billion deal with the International Monetary Fund (IMF) that was initially signed in 2019. The agreement is set to expire at the end of this month, further exacerbating the country’s financial predicament. Prime Minister Shehbaz Sharif recently met with ambassadors from key countries to seek support in reviving the stalled IMF deal, making a last-ditch attempt to secure the unpaid portion of the $6.5 billion package initially agreed upon in 2019, prior to its termination on June 30.