ISLAMABAD: The Cabinet Committee on Inter-Governmental Commercial Transactions (CCoIGCT) has given the go-ahead for negotiations on a Framework Agreement and constituted a committee to negotiate the draft framework agreement with the Government of the United Arab Emirates (UAE).
This decision will pave the way for a significant investment of approximately 1.8 billion dollars in the development of the Bulk and General Cargo Terminal at East Wharf in Karachi Port Trust (KPT).
Chaired by Federal Minister for Finance and Revenue Senator Mohammad Ishaq Dar, the CCoIGCT meeting reviewed a summary from the Ministry of Maritime Affairs regarding the Government-to-Government (G2G) agreement between the UAE and Pakistan for the development of the Bulk and General Cargo Terminal at East Wharf in KPT under the Inter-Governmental Commercial Transaction Act, 2022.
Following a detailed discussion, the committee allowed negotiations on the Framework Agreement and constituted a committee comprising representatives from the Ministry of Foreign Affairs, Ministry of Finance, Secretary Law & Justice, and Secretary Maritime Affairs to negotiate the draft agreement with the UAE government.
Sources reveal that the federal government aims to finalize the agreement with the Abu Dhabi government before August 5, facilitating the transfer of the bulk and general cargo project to Abu Dhabi on a government-to-government basis. Upon receiving Abu Dhabi’s consent, the Ministry of Foreign Affairs issued a No Objection Certificate (NOC) for the construction of the Karachi Gateway Terminal at Karachi Port, which aims to boost global trade. In this context, a framework agreement will be signed with Abu Dhabi under the Intergovernmental Transactions Act 2022.
The Ministry of Maritime Affairs forwarded a draft Framework Agreement and Expression of Interest (EOI) to the CCoIGCT for signing between the AD Port of the UAE and the Karachi Port Trust in Pakistan. The agreement aims to develop a Bulk and General Cargo Terminal along with associated infrastructure at East Wharf in Karachi Port.
The draft Framework Agreement, received from the Ministry of Foreign Affairs, underwent scrutiny by the Karachi Port Trust, which provided comments and directed the management to proceed with the matter in compliance with the prevailing laws. Simultaneously, the draft was sent to the Ministry of Foreign Affairs and the Law and Justice Division for their views, comments, and legal vetting. The Law and Justice Division stated that the administrative decision regarding the matter should be taken by the Ministry of Maritime Affairs from a policy perspective. While no specific legal questions were raised, the division expressed willingness to provide necessary assistance if any specific legal issues arose.
The Inter-Governmental Commercial Transaction Act, 2022 empowers the Federal Government to enter into G2G agreements with foreign states. It includes provisions for negotiating and approving such agreements, with the CCoIGCT authorized to conduct negotiations, constitute committees, and recommend approval of agreements to the Cabinet.
In line with the above, the proposed actions are as follows:
- CCoIGCT authorized negotiations on the Framework Agreement.
- A committee will be constituted to negotiate the draft Framework Agreement, vetted by the Law & Justice Division and the Ministry of Foreign Affairs.
- Another committee will be established to negotiate the price discovery mechanism based on the commercial agreement to be signed between KPT and the AD Port UAE.
The Minister for Maritime Affairs, Syed Faisal Ali Subzwari, earlier reviewed and approved the submission of the summary to the CCoIGCT. Several federal ministers and senior officers from relevant ministries attended the meeting, including the Ministers for Commerce, Power, State for Petroleum, as well as officials from the Finance, Maritime Affairs, Law & Justice, and Commerce departments.
