Dr Huma Baqai

16th Oct, 2022. 10:15 am

Blue economy: pursuing Pakistan’s maritime interests

“Maritime is not just a sector but a parallel economy, where various sectors of the economy meet.”

In the twenty-first century, the concept of the ‘Blue Economy’ has become increasingly popular. The concept was first coined by Gunter Pauli in 2010, the author of the book The Blue Economy: 10 Years, 100 Innovations and 100 Million Jobs. According to the World Bank, the blue economy is the “sustainable use of ocean resources for economic growth, improved livelihoods, and jobs while preserving the health of ocean ecosystem.” Oceans are now seen as drivers of human development, source of food material, and space. Blue economy is the future of sustainable growth for the world and Pakistan. It’s our sustainable path from scarcity to abundance. It has the potential to create jobs for our jobless youth, stimulate the anaemic economic growth, mitigate the impact of climate change, and help address the scarcity of food for our growing population.

It is estimated that the world’s wetlands provide forty-seven trillion dollars’ worth of ecological services annually, and support at least one billion jobs. But more importantly, a 2021 report by the High Level Panel for a Sustainable Ocean Economy found that ocean based climate and nature-based solutions could collectively reduce around four billion tonnes of greenhouse gas emissions annually by 2030 and more than eleven billion tonnes by 2050. As per the World Economic Forum report, it is equivalent to closing all of world’s coal-fired plants for a year. The world’s coastal population contributes significantly to the global economy, an estimated one and a half trillion dollars per year, with expectations pointing to some three trillion dollars by 2030.

Pakistan shares maritime boundaries with Iran, Oman, and India; claims an enormous Exclusive Economic Zone (EEZ) of 240,000 sq km and a continental shelf giving an additional 50,000 sq km. Despite a tremendously rich coast and a huge mass of water at its disposal, the country has not been able to develop into a true maritime nation. Majority of the world’s population is concentrated around the coasts, however, in case of Pakistan, most of the coastline is scarcely inhabited. Hence, innovative interventions are needed.

Effective management of blue economy could fetch global economy of $1.5 trillion. As per Global Investment trends, 35 percent of global green investment is in the power sector, 29 percent in transport, 11 percent in water infrastructure; Pakistan’s progress is not stellar. The blue economy in Pakistan, despite the Belt and Road Initiative (BRI) focus on it and Pakistan being a part of it, has not developed sufficiently. It remains an unexplored domain which does not receive the requisite attention of policymakers.

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China is also now more focused on Maritime Silk Route rather than the BRI. Thus, improving the status of mangroves and eco-friendly development of ports mentioned in CPEC makes good sense (blue partnership). The importance of the blue economy is evident from the fact that life below water has been incorporated into sustainable development goals (SDGs).

Blue economy contributed 0.45 percent to Pakistan’s GDP which is $1 billion, and 0.2 percent of GDP is contributed by marine fisheries which are overexploited. Nearly 30 percent of marine habitat and 44 percent of coastal reefs had been destroyed by 2020. Around 95 percent of marine life contains micro-plastics. Pakistan’s maritime sector is confronted with governance issues, poor technology, marine pollution, and destruction of mangroves. A globally sustainable model has been made unsustainable in Pakistan because of the aforementioned issues.

The potential is huge, approximately $5 billion can be generated annually through coastal and marine tourism. Coastal area of Pakistan is ranked 74th out of 142 coastal countries. Pakistan’s mangroves area is the sixth largest in the world, with a value of around $20 million. Some focus and a rethink seem to be there, but it’s not enough. Pakistan’s ranking in the liner shipping connectivity index has increased by around 34.06 points, Pakistan’s Ministry of Ports and Shipping has been renamed to the Ministry of Maritime affairs.

Joint Secretary Ministry of Maritime Affairs Kamran Farooq Ansari is on record saying that through the 18th Amendment, maritime functions were dispersed to provinces causing a lack of consensus on policies and initiatives. Thus, the country needs an integrated National Maritime Policy. He also emphasized on the need of amending the mercantile marine policies and suggested offering incentives and tax exemptions to attract investment in the sector.

Pakistan’s coastal ecosystems have enormous potential to capture and store carbon dioxide, thereby providing cost-effective blue carbon solutions. However, the country’s shipping capacity has declined from fifty ships in the seventies to a dozen in the 2000s. Pakistan National Shipping Corporation (PNSC) has a share of only 7 percent in the national imports and exports cargo, rest is carried out by foreign companies. If this was not the case, Pakistan could have saved $1.5 million annually. As per the World Bank’s latest statistics for 160 countries, Pakistan comes at 122nd place in terms of Logistics Performance Indicators (LPI), with Germany at the first rank and India at 44th.

Pakistan Merchant Marine Policy (2001) had set a new target to upgrade merchant marine fleet share of cargo from 5 percent to 40 percent by 2020 while increasing the vessel carrying capacity to one million tonnes. New targets have been set, but it is still unknown how many have been met.

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The total worth of Pakistan’s blue economy sector is more than $100 billion, however, the annual revenue generated is only $450 million. Pakistan had declared the year 2020 as the blue economy year and has also included the Blue Economy in the 2025 Vision Goal of the State.​

Blue Economy of Pakistan offers a way forward through a range of maritime sectors peculiar to the geostrategic and economic constraints of the country. Pakistan is a lower-middle-income country, with the economy growing at less than a 3 percent growth rate, whereas Pakistan Institute of Development Economics suggests for Pakistan a potential of sustainable 8 percent growth annually.

​We need policy reforms to boost investor’s confidence, development of special maritime industrial zones, we also have to work towards the concept of ‘greener shipping’ by 2050. Pakistan critically needs to fill the gap between education and maritime research and improve industry-academia linkages to support policies through research. There is a need for long-term and consistent policies along with monitoring and evaluation mechanisms, besides making inclusive and holistic contributions from all the stakeholders.

 

The writer is Rector MiTE

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