The Balochistan Liberation Army (BLA) and the Baloch nationalists have strongly come out against the decision of President General Pervez Musharraf of Pakistan to hand over the responsibility for the management of the Chinese-constructed Gwadar commercial port to the Port of Singapore Authority(PSA) International, as reportedly advised by China.
Originally, Musharraf had intended requesting the company, which runs the Dubai port, to run the Gwadar port too. According to reliable Baloch sources, Chinese intelligence and security officials based in Gwadar to protect the Chinese engineers expressed their reservations about the Dubai Company because of its close relations with the US. The Chinese were afraid that the Dubai Company might be used by the US intelligence community for collecting intelligence about the future movements of Chinese naval ships after the naval base in Gwadar, now under construction by the Chinese, is commissioned by 2010.
Under Chinese pressure, the original tenders were cancelled and fresh tenders were invited. After examining them, it was decided to award the contract to a consortium headed by the PSA International. The PSA International is owned by the Singaporegovernment's investment holding company Temasek. Pakistan's AKD Group is part of the consortium. Aqeel Karim Dhedhi, son of (late) Haji Abdul Karim Dhedhi, is the Chairman of the AKD Group. The Dhedhis are an affluent Memon family originally hailing from a village called Kutiyana in the formerly princely state of Junagarh in India, where they owned a textile mill. The Memons are converts to Islam from Hinduism. The Dhedhis were members of the Pakistan Muslim League and migrated to Karachi at the time of the partition. Aqeel Karim Dhedi is known in Pakistan as the King of the Karachi Stock Exchange.
The Chinese have undertaken the construction of the Gwadar port in two phases. Under the first phase, they completed the construction of the commercial port ahead of schedule in the beginning of last year and handed it over to the Pakistani authorities. However, the port could not be commissioned so far because of a delay on the part of Pakistani engineers in completing their part of the work relating to the construction of roads and housing and the deepening of the port channel. The delay was further aggravated by widespread acts of violence all over Balochistan following the murder of Nawab Akbar Bugti, the legendary Baloch nationalist leader, by the Pakistani Air Force in an air strike in August last year. Work on the second phase for the construction of a naval base, which would be used by the Pakistani and Chinese navies, started last year.
The Pakistani authorities say that their engineers have since completed their work and that Musharraf would be inaugurating the port around March 22, 2007, when the first ocean-going ship would call at the port.
The Baloch nationalists have been strongly opposed to the port on the followinggrounds—all the decisions regarding its construction were taken by the Army without any role for the Balochistangovernment; all the major civil contracts for the construction were awarded to non-Baloch companies in Lahore and Karachi; a large number of Pakistani ex-servicemen and Punjabis have been re-settled in the province in order to work in the project, thereby seeking to reduce the Balochs to a minority in their homeland; there has been discrimination in the matter of recruitment of Balochs not only by the Pakistani authorities, but also by the Chinese ; the Chinese intelligence and security officers posted in Gwadar ostensibly for the protection of the Chinese engineers have been collecting intelligence about the Baloch nationalists and passing it on to the Pakistani authorities.
The Baloch nationalists, who view the Gwadar project as leading to a Punjabi-Han colonisation of their homeland, are also strongly opposed to the proposed gas pipeline from Iran to India via Pakistan, which has to pass through their territory. They are determined to oppose its construction too if they are not involved in the negotiations as an interested fourth party and given a share of the transit fee and other revenue. They are very unhappy over what they see as the failure of thegovernment of India to ascertain their views on the proposed pipeline and to advocate their right to a fair share of the revenue.
The Baloch nationalists have now come out against Musharraf's decision to make the PSA responsible for the management of the commercial port for 40 years. Their opposition to the award of the contract to the PSA is principally on two grounds. First, thegovernment of Balochistan and the Baloch nationalists were not consulted before the decision was taken. Second, the PSA will be following the same policy as Beijing in the matter of discrimination against the Balochs in recruitment to jobs and in giving preference to Punjabis and other Pakistani ex-servicemen. If it doesso— as they are afraid it will— this could hasten the process of reducing the Balochs to a minority in their homeland. They are also unhappy over the non-association of any Baloch company with the consortium and over the association of a company from Karachi known for its strong links with the Pakistan Army.
In a statement issued on February 6, 2007, the Secretary-General of the National Party, Mir Hasil Khan Bizenjo, demanded that all agreements signed by Islamabad with international firms for the exploitation of the mineral and other resources of Balochistan should be tabled in the Senate and the Balochistan Assembly and their approval sought. He added:
"Islamabad is ignoring the people and the Baloch leadership and is signing accords with various international firms without taking them into confidence." He described the attitude of the Federalgovernment as anti-Baloch and said that Prime Minister Shaukat Aziz signed an agreement with the PSA against the will of the Baloch people and without consulting the Baloch leadership. He said that the industry in the country was running on gas from Balochistan, but instead of giving a due share to the people of the province, thegovernment had been launching military operations in Dera Bugti and Kohlu districts for one and a half years. Referring to the Saindak project in the Chagai district, Mir Bizenjo said that the Chinese company was earning millions of dollars from the copper-cum-gold project, but Balochistan, the owner of the huge mineral reserves, was being paid only Rs100 million a year.
The Balochistan National Party (Mengal) has also criticised the Federal government’s decision to hand over the operation of the Gwadar Port to the Singapore company. Speaking at a meeting held on the death anniversary of Mir Asad Mengal, son of Ataullah Mengal, in Ahmed Khanzai on February 6, 2007, the leaders of the party declared that they would continue their struggle against what they called usurpation of their resources. They described the decision to award the contract to the PSA as an infringement of the rights of the Baloch people. They said that the Baloch people would not co-operate with thePSA.
To express its displeasure over the award of the contract to the PSA, the BLA fired two rockets at the Gwadar port area on the night of February 1,2007, disrupting the power supply to the entire port area for several hours. Both rockets were fired from Padi Zar, the eastern part of the city, at midnight. While one of the rockets missed its target and strayed into the sea, the other hit a power station in the port area. Following this, the security forces did a house-to-house search on February 2, 2007, in the Gwadar and Sui areas and reportedly recovered 30 rockets.
In the past, the Chinese engineers working in the Gwadar project had been the targets of explosions and other acts of violence by unidentifiedelements—some of them suspected to be Uighurs from the Uighur diaspora inPakistan—resulting in fatalities. One could not rule out the possibility of similar acts of violence against the Chinese staff of the PSA, when they start their work in full steam.
The formal agreement on the award of the contract by the Gwadar Port Authority (GPA) to the PSA was signed at Gwadar on February 6, 2007. Prime Minister Shaukat Aziz, who was present on the occasion, said that the PSA would invest $550 million during the next five years. He added: "We want to operate this port in the best possible manner. We have selected the best company which is already operating ports in 11 countries."
Under the agreement, the PSA will run the port for 40 years, during which time it will be exempted from corporate tax. The Pakistangovernment has also abolished all duties on any equipment and machinery imported to develop the port for 20 years. The PSA has promised to make an investment of $5 billion to $8 billion in the project over 40 years.
The Gwadar port will be the third deep seaport in Pakistan after Karachi and Port Qasim. As compared with the Karachi port and Port Qasim, which operate on a royalty basis, the selection of the port operator for Gwadar was on the basis of a gross-revenue-sharing. According to the "News", a daily newspaper (December 4, 2006), the operator will set up three different companies to look after various activities at the port, such as cargo operation, marine operation and the free economic zone. The first multi-purpose terminal at Gwadar has been completed, with a quay length of 600 meters and a depth of 14.5 meters, with a sizable backup area. Cranes, other terminal equipment and tugs have already been acquired.
On the same day (February 6), at a function held at Lahore, the Pakistan Railways and a consortium headed by the Dongfang Electrict Corporation (DEC) and the Second Survey and Design Institute (SSDI) of China signed an agreement for carrying out a prefeasibility study for a new rail link from Havelian in Punjab to Khunjrab on the Pakistan-China border, a distance of about 750 kms. This rail line will pass through Kashmiri territory in the Northern Areas, which was illegally occupied by Pakistan in 1948. Under a resolution passed by the Indian Parliament in 1994, this area is an integral part of India. Despite this, Pakistan has been awarding to China one contract after another for projects in this area under its illegal occupation. It has already awarded a contract to China for the upgradation of the Karakoram Highway. When these projects get going, over 6,000 Chinese engineers, many of them from the People's Liberation Army, are expected to be based right across the Kargil sector and in the proximity ofSiachen.
The pre-feasibility study would be completed in nine months. The Dongfang Electrict Corporation is one of the largest Chinese state owned conglomerates and has been associated with the Pakistan Railways for over two decades. The DEC is currently implementing two major contracts for supplying diesel, electric locomotives and high capacity freight wagons to the Pakistan Railways. The city of Havelian is located at the westmost end of the Karakoram Highway, which connects Havelian to the ancient Silk Road and provides an important link to China. It is the second largest municipality in the Abbottabad District, in what used to be known as the Hazara District of the North-West Frontier Province. It is ultimately proposed to connect Havelian with Gwadar by a railway line..
The China Harbour Engineering Company (CHEC), which is constructing the two phases of the Gwadar port, has also been given the contract for the construction a new airport at Gwadar in about 18 months at a cost of $40-50 million. Curiously, whereas the other commercial airports of Pakistan are run by the Civil Aviation Department, the Gwadar airport is proposed to be run by the Army and the Air Force. According to Baloch sources, the Pakistani authorities have agreed to allow the Chinese Air Force to use this airport in an emergency.
The Pakistan government has also awarded to the Great United Petroleum Holdings Company Limited (GUPC) of China a contract for preparing a feasibility study for setting up a petrochemical complex at Gwadar to be constructed with an initial investment of $12.5 billion. According to the Pakistani authorities,in the first three years after its construction, the refinery will be able to refine 10.5 million tonnes of crude oil per year. It would be increased in 7-9 years to 21 million tonnes and in another eight years to 63 million tonnes. As part of the petrochemical complex, the Chinese would also set up a captive power plant and a water desalination plant.